In negotiations, it's always the party in a weaker position who ends up conceding.
To create that dynamic, I conveyed that Taewoo Group had little emotional attachment to BOBCAT.
"If you're reluctant to sell BOBCAT, we can assist you in another way. While we cannot do much about the unsold apartments, Taewoo Construction could take on the apartments that are near completion. That way, your liquidity problem won't become any worse."
"The scale would shrink considerably."
The sale of BOBCAT was worth 5 trillion won.
The unsold apartments amounted to barely 500 billion won.
A drop to one-tenth of the value naturally made it feel like a loss.
"You can take your time deciding whether to sell BOBCAT or transfer the unsold apartments to Taewoo Construction. Taewoo Group is willing to wait. Of course, it's fine if you decide to take no assistance at all."
"Ha ha, Taewoo Group isn't in a rush."
The one in a hurry was Doosan Group.
And the person at the helm of this massive ship called Doosan Group was Chairman Park Min-yong.
"Also, I haven't mentioned the full terms of the BOBCAT acquisition. In addition to acquiring BOBCAT for 5 trillion won, Taewoo Group would also take ownership of the stake Doosan Group holds in the Nonhyeon-dong building."
"The Nonhyeon-dong building? That property is worth over 180 billion won."
"Considering that you would be selling BOBCAT for 5 trillion won, this is a rather minor term. If you prefer, you can deduct the 180 billion won value from the acquisition price. Then you would be selling BOBCAT for 4.85 trillion won."
I had little interest in real estate.
The condition was simply inserted to slightly devalue BOBCAT's price.
After all, we were already building a new headquarters in central Seoul and a financial hub building on KEPCO land, so additional land wasn't particularly necessary.
"I'll discuss this with my executives and get back to you."
"Take your time. We'll wait as long as it takes."
In negotiations, patience can become a tool of pressure.
The more I appeared unhurried, the more Chairman Park felt urgency—and the greater the chance he might make a hasty decision.
**
Doosan Group Executive Meeting
It was a meeting attended by the presidents of each subsidiary and the heads of key departments at the group headquarters.
In front of everyone, Chairman Park Min-yong laid out Taewoo Group's proposal without holding anything back.
"We need to decide whether to sell BOBCAT to secure liquidity in a stable manner, or transfer the unsold apartments to Taewoo Construction and merely get through the current crisis."
"Even if we transfer the unsold apartments, it won't cover Doosan Construction's losses. Last year, the subsidiary posted over 300 billion won in losses, and this year, losses are projected to reach 650 billion won."
At this rate, Doosan Construction's deficit could exceed one trillion won.
Since there was no sign of recovery in the construction market, unsold apartments would surely continue to accumulate next year as well.
No matter how large a company Doosan Group was—ranked in the top ten of the conglomerates—one subsidiary posting a trillion-won loss was unmanageable.
"Kim Min-jae told me to make a choice. We are now in a position where we must decide: save BOBCAT or save Doosan Construction."
"It's too regrettable to sell BOBCAT now. It has only just returned to normal operations, and its profits are projected to increase every year."
The president of Doosan Heavy Industries opposed the sale of BOBCAT.
It was understandable—Doosan Heavy Industries had done everything possible to save BOBCAT, and now, just as it was beginning to show promise, the company was about to be sold.
"I'm opposed. If we can sell BOBCAT for 5 trillion won, we can create a completely new scenario. We could wipe out all of Doosan Construction's debt and solve the liquidity issues of other subsidiaries. It's an amount that allows us to start afresh."
"While I respect your opinion, BOBCAT is a key company that will serve as Doosan Group's new cash cow. If we can just weather the current crisis, BOBCAT will make Doosan Group prosperous."
A conflict arose between the president of Doosan Heavy Industries and the CFO.
These two held very high positions within Doosan Group, so no one dared to intervene.
"Think about it. If we do not resolve the liquidity problem, BOBCAT has no future. Moreover, Taewoo Group has offered 5 trillion won to acquire it. You can't guarantee that we could sell BOBCAT for that price if we wait any longer."
"I can guarantee it. In one or two years, we could sell BOBCAT not for 5 trillion, but for 6 or 7 trillion won."
"Tut-tut. Do you really think 5 trillion now and 7 trillion in two years hold the same value? Investing 5 trillion now will solve our liquidity issues. Two years from now, even if we invest 7 trillion, the chance of resolving liquidity problems is much lower."
From the CFO's perspective, the group had to reduce its debt by any means necessary.
The monthly interest payments were only increasing, and he worried that in two years, no matter how high sales were, they would be unable to cover the interest.
"Everyone, calm down for a moment. Also, Kim Min-jae requested that, as a condition for acquiring BOBCAT, we transfer the stake in the Nonhyeon-dong land. If we don't, he said we could deduct 180 billion won from the acquisition price."
"The Nonhyeon-dong land is valuable, but we were planning to sell it anyway. Transferring it to Taewoo Group in exchange for 5 trillion won isn't a bad idea."
"The Nonhyeon-dong land holds the history of Doosan Group. I'm reluctant to hand it over to Taewoo Group."
The CFO paused, deep in thought, and then spoke.
He had thought of a way to sway Chairman Park Min-yong's mind.
"Then how about adding a clause? That we can repurchase the Nonhyeon-dong land five years from now."
"Do you think Taewoo Group would accept such a condition?"
"Taewoo Group has no particular attachment to the Nonhyeon-dong land. They're already building high-rise buildings in two prime locations in Seoul. Why would they need this land? The chance of them accepting is very high."
"If we repurchase at market price five years from now, we'll have to pay more."
"No matter how much real estate prices rise, at most it will double. Even if 180 billion won becomes 360 billion won, it's still negligible compared to 5 trillion won."
The CFO's authority was formidable.
The president of Heavy Industries resisted to the end, but he could not overrule the CFO, who controlled the company's finances.
"Hmm. Then the finance and planning teams should prepare a report on the sale of BOBCAT. Compare the scenario of selling BOBCAT versus not selling it, and detail which option is better for Doosan Group's future."
"We'll have the report ready within this week."
What did the report really matter?
Chairman Park's mind was already made up; the report was needed merely as a formality to provide reassurance.
A few days later.
President Han returned from Europe.
He had finalized the contract for Taewoo Group's Asian production rights for insulin with Novo Nordisk and was busy moving around to recover the funds dispersed throughout Europe.
"Your face looks half the size it should be. There's nothing better for recovery than samgyetang."
"I heard you've been extremely busy as well, Chairman. I also heard you're planning to acquire BOBCAT from Doosan Group—is that true?"
"You'll get your answer after you start with the broth."
Slurp!
President Han drank the rich samgyetang broth, and only after I saw his Adam's apple move did I give my answer.
"We'll acquire BOBCAT. At the ridiculously low price of 5 trillion won, I don't see another opportunity to buy a company like BOBCAT anytime soon."
"BOBCAT's value has dropped every time it went public for IPO purposes."
"Sure, its debts are high and sales are low now, so its corporate value is low, but in my view, the company is heavily undervalued."
President Han's expression changed in real time as he considered this.
After taking a deep breath to organize his thoughts, he continued.
"If you say it's undervalued, Chairman, I'll acknowledge BOBCAT's potential value. But is it really necessary for Taewoo Group to acquire a construction machinery company like BOBCAT?"
"When we fully enter the shale gas business, won't the demand for construction machinery skyrocket? We can make money from shale gas and also profit from the construction machinery business."
We planned to pour tens of trillions of won into shale gas.
Naturally, the scale of construction projects would expand accordingly.
This way, we could earn through two tracks simultaneously.
"So you mean acquiring a company that will benefit from the boom in shale gas?"
"There's also a risk reduction effect. Even if the shale gas business doesn't go as planned, we can at least mitigate losses somewhat through construction machinery sales. Of course, it would be a relatively small amount."
"I understand. Then let's proceed with the acquisition of BOBCAT."
"You're not opposing it?"
"There's no reason to. And this might sound a little arrogant, but why would anyone oppose acquiring a 5-trillion-won company? Honestly, even if the Chairman used 5 trillion won just for a hobby, I could let it slide."
Had President Han always been this generous?
Somehow, he had grown into a bigger person, and it also reflected the high profits he had generated in Japan and Europe.
"You must have had quite some fun in Europe."
"I pulled one last big play. Stirring the Spanish side with the Quantum Fund worked well, and we made additional profits—more than the BOBCAT acquisition amount."
Indeed, people are more relaxed when their wallets are full.
Of course, it wasn't Han's own wallet that was full, but now that Taewoo Group's treasury was flush, President Han had become unusually relaxed.
"To add, BOBCAT isn't just for shale gas development. It can develop robots for rocket logistics centers and equipment for automation in various factories. It's a company worth far more than 5 trillion won."
"If that's your assessment, Chairman, I trust it. By the way, David contacted me. He says he has sufficiently cultivated relationships with local influencers and shale gas companies in Texas."
That meant the first round of preliminary work was complete.
It was now time to jump into the shale revolution in earnest, and for that, I had to go to the U.S. myself.
"Not long after returning from Europe, you're heading to America. President Han, will you come along?"
"There's no need to go immediately. David says he hasn't yet persuaded one of the key local influencers in Texas. It would be fine to go in about two weeks. And if the Chairman wishes, I'm ready to go to Mars instead of the U.S."
Originally, Han wasn't this kind of person.
Over time, he had grown more obsequious.
"With about two weeks left, there's still time to stop by Centurion."
"Once I inform them that the Asian production rights for insulin are secured, I'm already curious to see what expression CEO Seo Jeong-jun will make."