Golden Spoon Investment Portfolio - Chapter 259

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This chapter was translated by Lunox Novels. To support us and help keep this series going, visit our website: LunoxScans.com
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259. Whether he’s a fearless upstart or a true phoenix, time will tell.

“Hah. Hansei Group going bankrupt? That’s the most absurd thing I’ve heard in recent memory.”

Cheon Seong-deuk let out a hollow laugh as if he couldn’t believe what he was hearing, then his expression hardened.

“Surely you’re not unaware that Hansei Group ranks 18th in the business world—higher than the Daeheung Group your family leads?”
“Of course I know. Last year’s revenue reached 5 trillion won. It’s one of the nation’s largest conglomerates.”
“And yet you claim it will go bankrupt!”

Cheon Seong-deuk glared fiercely and pressed the question, but Seok-won nodded without the slightest hesitation or intimidation.

“That’s correct. Appearances may be deceiving, but internally it’s nothing but a hollow sandcastle.”
“Hansei Group is merely a hollow sandcastle?”

No matter how he thought about it, it sounded like nonsense, yet Seok-won’s unwavering confidence stirred an unsettling feeling within him. Cheon Seong-deuk had learned that such instincts usually preceded trouble, so despite thinking the probability low, he decided to listen.
Whenever he had this kind of feeling, something bad always happened, so even though Cheon Seong-deuk thought the possibility was low, he still took a stance to listen.

“You wouldn’t say something like that without reason. Tell me what your basis is.”

Glancing at it, Cheon Seong-deuk asked.
Glancing at it, Cheon Seong-deuk asked.

“An investigation into the commercial paper issued by Hansei Corporation, Hansei Steel, and their construction subsidiary—the three core affiliates—over the past year.”
“….”
“….”

Watching him, Seok-won continued.
Seeing that, Seok-won spoke.

“As you can see in the documents, Hansei Corporation issued 120 billion won in CP, construction issued 21.4 billion won, and steel, which is building a privately-owned steel mill with a capacity of 9 million tons in Dangjin, issued the most CP at 690 billion won.”

Seok-won continued speaking as he noticed Cheon Seong-deuk’s expression stiffen slightly.

“In other words, it means Hansei Steel needs to repay over 800 billion won in commercial paper debt by the end of this year or early next year.”
“…!”
“And if we factor in the debts from other smaller subsidiaries we haven’t fully accounted for yet, the total repayment amount could balloon to 900 billion won, or even 1 trillion won.”

Cheon Seong-deuk set down the documents and spoke as if it were nothing of consequence.

“The amount is substantial, certainly, but where in the world do you find a company operating without any debt?”

Yet he couldn’t hide the tension that had crept into his face, unlike before.
Seok-won nodded in agreement with a slight shrug of his shoulders.

“As you say, leveraged management—growing companies by borrowing from banks—has become the norm. Having substantial debt isn’t particularly unusual.”
“You understand the situation well enough.”
“But all parties come to an end eventually, and when anything exceeds its proper measure, it invites disaster. Wouldn’t you agree?”
“Are you suggesting that Hansei Group has crossed that line?”

Seok-won, meeting his gaze, answered without hesitation.

“They’ve already far exceeded the danger threshold.”
“….”
“Do you know why the commercial paper issuance is particularly large among Hansei Steel’s subsidiaries?”
“Isn’t it because of the steel mill being constructed in Dangjin, as you mentioned earlier?”

Cheon Seong-deuk crossed his arms defensively as he spoke.

“Precisely. Even Pohang Steel completed its facilities in stages over a long period, methodically. But Hansei is attempting the reckless feat of constructing an enormous steel mill all at once. On top of that, they’ve introduced slab casting equipment and molten reduction equipment whose commercial viability hasn’t been 100% verified, and they’re experiencing considerable trial-and-error in achieving normal operations.”
“It’s only natural that constructing a massive steel mill to produce molten metal isn’t easy. Still, the construction is nearly complete despite all the ups and downs, and if normal operations commence, it will become a springboard for Hansei Group to grow to the next level.”

There were even rumors that massive trucks lined up in front of the Pohang Steel Manufacturing Plant every dawn, competing to receive the steel products being produced, such was the explosive growth and the corresponding surge in domestic steel demand.
Steel products were indispensable across industries—from automobiles and shipbuilding to the reinforcing bars used in apartment construction—so it was only natural.

‘There’s a reason they call steel the rice of industry.’

So much so that there was even a joke that the department with the least work at Pohang Steel was the sales division, since orders piled up on their own without anyone lifting a finger.
Chairman Choi Byung-moo was pushing forward with what seemed like reckless steel mill construction precisely because it was such a lucrative business.

‘But when ambition exceeds ability, trouble always follows.’

Seok-won dismissed the fleeting thought from his mind and answered.

“As a citizen myself, I certainly hope that the steel mill that Hansei Group is promoting operates properly. However, that doesn’t mean I’m willing to board a sinking ship with them.”

Cheon Seong-deuk’s expression turned sour at the tone that completely wrote off Hansei Group’s bankruptcy.

“You keep saying such discouraging things, but I’m well aware of Hansei Group’s financial difficulties, just as you say. Do you really think I’ve survived all these years in the Myeongdong underworld without knowing that?”
“Of course, sir.”
“Then why do you think I’m holding onto Hansei Group CPs?”

Seok-won spoke calmly.

“Because you believe in the principle that a great horse never dies.”

At such an unperturbed answer, Cheon Seong-deuk’s brow furrowed slightly instead.

“Right. You understand well. The loans that Hansei Steel—the company you said was in the most dire straits—received from financial institutions including the Industrial Bank up until last year amount to 1.43 trillion won. With such an astronomical sum tied up, do you really think the banks would just let them go bankrupt?”

Cheon Seong-deuk spoke with a snort, as if stating an obvious fact.

“Frankly, if Hansei Steel collapses, all that loaned money vanishes into thin air. To prevent that, the banks will do whatever it takes to prop them up.”
“….”
“The government would also face enormous repercussions if an industrial conglomerate ranked 18th in the nation were to crumble. They’ll step in with rescue measures to prevent that from happening.”

Yet even after hearing this, Seok-won didn’t change his position at all.

“There’s an old saying: borrow a hundred million won from a bank and you’re a debtor, but borrow a trillion and you’re the master. I’m well aware that government-controlled finance works by forcing more capital to be injected to recover already-loaned funds, and that’s precisely how the principle of ‘a great horse never dies’ came about.”

Then he offered a bitter smile.

“I suspect Chairman Choi Byung-moo is perhaps the executive who exploits this principle most skillfully.”

Called a master of lobbying and once embroiled in the Suseo scandal that shook the entire nation—forcing him to step down from his position as group chairman—Choi Byung-moo, chairman of Hansei Group, had made a remarkable comeback and was now expanding his business ventures without hesitation, as if such an incident had never occurred.
The Suseo scandal was a massive corruption case involving Seoul City, the Construction Ministry, the Blue House, and even the National Assembly, stemming from the approval to develop a 35,500-pyeong greenbelt in the Suseo and Daechi areas—regions once called the last golden egg of Gangnam—into an apartment complex.
Chairman Choi Byung-moo played a pivotal role in this affair and reaped enormous profits, which led to his appearance at a National Assembly hearing and his arrest.

“When the economy is booming, there’s little problem in recklessly expanding business by drawing heavily on bank funds without any equity capital. But once the economy enters a contraction phase, the situation becomes entirely different.”
“…!”
“In Pohang Steel’s case, they were able to navigate smoothly because they benefited from the steel industry boom each time they expanded blast furnaces in Pohang and Dangjin. But Hansei Steel, unfortunately, faces the misfortune of having its steel mill completed just as the market peaked and began its downward trajectory.”

Cheon Seong-deuk listened with a troubled expression as Seok-won methodically laid out the facts.

“Hansei Steel is burdened with astronomical debt exceeding 4 trillion won, yet the company’s projected revenue for this year barely surpasses 1 trillion won. And that’s total revenue, not operating profit. To put it bluntly, it’s a zombie company that can’t even properly pay interest on what it earns.”

Seok-won emphasized his point with conviction, his voice cutting through the air with merciless precision.

“As the saying goes, too big to fail—if Hansei Steel collapses with trillions in bank loans backing it, the impact on the national economy would be catastrophic. The government and banks might attempt band-aid solutions by injecting more capital. That is, if it were only Hansei Steel.”

Cheon Seong-deuk, who had been listening quietly, finally spoke, his voice low and measured.

“So you’re saying that if the debts of other affiliates unravel one after another and become unmanageable, even the government and banks would have no choice but to surrender.”
“Precisely. The visible debt alone exceeds 4 trillion won, but considering Chairman Choi’s management style, the hidden liabilities beneath the surface would be far greater.”
“Hmm.”
“Moreover, given that the affiliates are intricately entangled with mutual payment guarantees centered on Hansei Steel, the moment trouble erupts anywhere, they’ll collapse like dominoes.”

Cheon Seong-deuk nodded, his expression hardening.

“Chairman Choi certainly has plenty of hidden debts scattered about.”

Yet Cheon Seong-deuk still regarded Seok-won with skeptical eyes.

“I’ll grant you that Hansei Group has its vulnerabilities, as you say. But Chairman Choi isn’t someone to be trifled with—a man who built a conglomerate from nothing after weathering countless storms. As I mentioned before, though the Suseo incident caused quite a stir, the fact that he bounced back like a Roly-Poly toy speaks volumes.”

Seok-won’s expression grew meaningful, a subtle smile playing at the corners of his mouth.

“Then let’s make a wager, shall we?”
“A wager?”

Cheon Seong-deuk’s eyes narrowed, suspicious of hidden intentions.

“If you sell your Midopa shares at the price I propose or grant me a proxy, and Hansei Group doesn’t default by the first half of next year, I’ll return the Midopa shares you sold to me as they are.”

Cheon Seong-deuk’s face registered surprise at the unexpected proposal.

“Are you serious?”
“I am. If I weren’t confident, I wouldn’t have brought this up with you in the first place.”
“Huh.”

Cheon Seong-deuk exhaled slowly, his expression one of bewilderment.

“Did you get permission from Chairman Park?”
“He delegated full authority over this matter to me.”

Cheon Seong-deuk, startled anew by those words, regarded him with fresh appreciation.

“Chairman Park seems to trust you quite a bit.”
“I’m grateful that he does.”

Cheon Seong-deuk drummed his fingers thoughtfully against the sofa armrest, lost in contemplation.
Time passed in silence.
Finally, having reached his decision, Cheon Seong-deuk looked up and spoke to Seok-won, who waited patiently for his answer.

“Very well. I see no reason to lose by accepting your wager.”
“Thank you.”

Seok-won smiled faintly at the response he’d hoped for.
His composure—as though he’d already won the bet—made Cheon Seong-deuk study him with a piercing gaze.

“If you change your tune later, you’d better be prepared for the consequences.”
“That won’t happen, so please don’t worry. And I’d suggest you liquidate your Hansei Group holdings this year if possible.”
“I’ll handle that myself. Don’t concern yourself with it.”

Cheon Seong-deuk cut off the advice curtly, and Seok-won said nothing more.
After Seok-won departed, Oh Tae-min, the butler, entered the reception room and carefully approached Cheon Seong-deuk, who sat alone on the sofa, lost in deep thought.

“Chairman.”

Cheon Seong-deuk uncrossed his arms and asked.

“Has he left?”
“Yes.”

Cheon Seong-deuk glanced at the spot where Seok-won had been sitting moments before.

“I think I misjudged him.”
“What do you mean, sir?”
“Chairman Park’s second son. I thought he was a young tiger showing promise. But he’s not—he’s a phoenix spreading its wings to soar into the heavens.”

For decades, I had assisted Cheon Seong-deuk, but there were scarcely a handful of occasions when he had offered such praise.
Moreover, since it wasn’t merely compliment but rather approaching the level of high acclaim, Oh Tae-min’s butler displayed an expression of astonishment.

“Was it truly to that extent?”
“It was.”

Cheon Seong-deuk nodded slightly, and his eyes gleamed with a sharp intensity.

“Oh.”
“Yes, sir. Please speak.”
“Investigate the financial situation of Hansei Group in detail. Particularly with the steel division—scrutinize it thoroughly to determine whether it can truly continue to exist.”
“Understood, sir.”

Cheon Seong-deuk leaned back against the plush sofa and murmured to himself.

“Daring to wager against me, no less. Whether this is a reckless fool or a true phoenix, I’ll soon discover.”

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This chapter was translated by Lunox Novels. To support us and help keep this series going, visit our website: LunoxScans.com
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