The Return of the Ruined Chaebol's Third-Generation Heir - Chapter 96

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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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The Regression of a Fallen Chaebol Heir — Episode 96
“I’ve brought good news for the end of the year.”
Three weeks later, in the Seonjin Group CEO Office.
Choi Dong-su opened the office door and spoke. He carried a folder of reports in his hand.
“Welcome.”
Mother of Kang Seon-woo smiled as she spoke.
“Good news, you say? I’m looking forward to it. Shall we sit?”
Mother of Kang Seon-woo gestured to a chair, and Choi Dong-su sat down and spread out his materials.
“With a down payment of 13.5 million dollars injected, our cash flow has stabilized.”
Mother of Kang Seon-woo nodded.
“The seven vessels sold under Sale and Leaseback have begun operations, and we’re seeing operating costs cut to approximately 1.4 billion won per vessel per month.”
“I recall the forecast was 1.7 billion won.”
“The situation has been so dire that cargo insurance prices have risen.”
In shipping, there were two types of cargo insurance. One was purchased by cargo owners—the shippers—to protect against damage or loss of the cargo itself. The other was shipowner liability insurance purchased by the shipping companies that operated the vessels.
It was insurance to cover the liability and compensation that shipping companies had to pay when cargo was damaged during operation, when accidents claimed lives, when ships were damaged, and so on.
“Recently, as shipping companies have fallen into financial difficulties—unable to pay port fees or fuel costs, with ships being seized—insurance companies have raised their premiums.”
Ironically, the volume of freight had decreased so there was less to transport, yet ships were still being seized for unpaid debts in other areas.
Mother of Kang Seon-woo nodded.
“What about the cargo volume?”
“DK Capital is supplying cargo at approximately 7,000 TEU per month.”
Mother of Kang Seon-woo’s hand stopped on the report.
“The contract was for 9,000, wasn’t it?”
“It’s only been three weeks. The trend is upward, and we should be able to meet the target within the first quarter.”
Mother of Kang Seon-woo looked back down at the report. The number 9,000 was circled.
Seven thousand in three weeks wasn’t bad.
“Has the deficit improved?”
“We’ve reduced monthly losses from 5 billion won before the sale to approximately 800 million won currently.”
They were still posting losses, but 5 billion won in monthly deficit had become 800 million.
Just three months ago, he’d lost sleep night after night, drowning in monthly deficits.
Eight hundred million was a number they could manage. Moreover, they were receiving final payments from vessel sales every month.
Seonjin Trading Company was entering a recovery phase.
“Container freight rates have recovered slightly to $560 per TEU, and the market is stabilizing following the Abu Dhabi intervention.”
Choi Dong-su turned over another page of the report.
“However, the European situation is concerning.”
Mother of Kang Seon-woo looked up.
“Greece’s sovereign bond yield has risen nearly 0.7 percentage points in a single month, and the market is talking about a fiscal crisis.”
“I don’t think it will directly affect us immediately.”
“You’re correct. There doesn’t appear to be any direct, immediate impact on us. However, if European banks falter, the shockwave could reach shipping finance.”
Mother of Kang Seon-woo gave a short nod.
The fact that Choi Dong-su was bringing this up meant it wasn’t something to dismiss.
“Please continue to monitor the situation.”
“Yes, understood. And there’s one more thing I should report.”
Choi Dong-su lowered his voice.
“Daegwang appears to be in serious trouble. With the put-back option on Dongbang Construction being exercised, they seem to be stuck with over 4 trillion won.”
Mother of Kang Seon-woo’s face hardened.
Daegwang was the eighth-largest conglomerate in the nation, and it had recently been expanding its power by acquiring multiple major corporations.
However, after being shaken by the Lehman crisis, the situation had worsened since the Dubai World moratorium.
“The market consensus is that a workout is highly likely.”
It didn’t sound like someone else’s problem. If Seonjin Trading Company’s deficits had continued, talk of creditor management and such could have befallen Seonjin as well.
“…It’s fortunate we moved quickly.”
Mother of Kang Seon-woo spoke quietly. Choi Dong-su bowed his head.
“That concludes the report.”
Choi Dong-su began to gather his materials and stood.
“Director Choi.”
“Yes, Chairwoman.”
“The year is already ending.”
Choi Dong-su stood without speaking. He’d never heard Mother of Kang Seon-woo make a sentimental remark.
“You’ve worked hard. Because you ran so tirelessly, we were able to survive.”
It was just a brief statement, but Choi Dong-su paused for a moment. Of course, Mother of Kang Seon-woo wasn’t stingy with praise.
But since taking on the interim CEO position—or even before that, from his days as head of the Management Planning Division—he’d worked under her, yet it had never felt quite like this.
“…Thank you, Chairwoman.”
Choi Dong-su bowed deeply.

* * *
“You even have a tree.”
As I entered the Ribbon Capital office, a small Christmas tree stood beside Han Jae-yi’s desk.
“I bought it. The office was too dreary.”
Han Jae-yi kept her eyes on the monitor as she spoke.
“That’s not really your style.”
Han Jae-yi turned her head to look at me.
“Ugh, it was just so bleak. So bleak! You sit here every day with that serious face, and Jung there is even worse—so stiff. The only person coming and going is Danny, and it’s just… ugh.”
I couldn’t help but laugh at her complaint.
“I think I’m fine, and Director Jung seems okay too. I think Danny might feel a little left out, though.”
“He’s all slick charm—it gets on my nerves. Don’t tell Danny what I said.”
“I’ll just watch how you do.”
“CEO.”
Just then, as Han Jae-yi and I were trading jokes, Jung Tae-sung’s voice came from behind me. I turned to see him offering me a coffee.
“Oh, thank you.”
“Coffee is ready for Director Han as well.”
“Thank you, Director Jung.”
I took the coffee and sat at the conference table. Shortly after, Han Jae-yi and Jung Tae-sung also sat down with their materials.
“All right, shall we get started?”
At my words, Jung Tae-sung spoke first.
“I’ll report on year-end matters.”
I listened while reviewing the materials he handed me.
“The frame construction at the Ochang factory is complete. Our goal is interior work in the first half of next year and equipment installation in the second half.”
“The frame went up quite quickly.”
“The contract included an incentive clause for shortening the construction schedule, so the contractor seems to have capitalized on that fully.”
“That’s exactly when accidents happen. Please ask the supervision company to ensure thorough oversight.”
Fast construction progress usually just meant either cutting corners on necessary safety measures or squeezing the workers.
“Understood.”
“Then shall we hear the report on Ulsan?”
“Shinhwa Welltech’s sales grew 17% year-over-year. The electrolyte additive orders have stabilized.”
“Looking at the report, operating profit still hasn’t increased.”
Sales had risen, but operating profit wasn’t growing.
“Yes, we’ve increased research and development spending, and we’ve also participated in a capital increase for our joint venture.”
Shinhwa Welltech was funneling all its earnings into R&D, and the joint venture with Japan’s Shinjin also needed funding for technology development, so both companies jointly executed a capital increase.
“That’s good. Keep going in that direction—please convey that to CEO Hong and Director Park.”
“Understood.”
“How about Synapse? Has Lucas settled in well?”
“Dr. Lucas has settled in Ulsan. He completed his first joint meeting with CEO Seo Min-seung, and the lab setup should be finished by January.”
Shinhwa Welltech was generating its own funds and investing them in research and development, but Synapse Robotics was different.
“For Synapse, please continue providing the necessary funds consistently. Especially when Lucas is scouting talent, ensure he can offer competitive salaries, and make sure domestic staff aren’t disadvantaged.”
“Understood.”
Synapse was a company with greater future promise, so now was the time for full support.
“Next, DK Capital and SJ Security.”
“DK reports came from CEO Danny. The staff has grown to twelve people, and inquiries have started coming in following the Seonjin deal.”
Seonjin was DK’s first success story. If inquiries were coming in, the next deal wasn’t far off. Once DK started building a reputation, my room to maneuver would expand.
“SJ Security has secured an office in Ochang. Once the Seoul office lease ends in March next year, they plan to relocate there.”
“If the staff needs moving expenses or housing support, please provide that.”
Jung Tae-sung’s lengthy report finally ended, and I turned to look at Han Jae-yi.
“Han, shall we begin?”
“KOSPI looks like it will close in the 1,680 range for the year-end. That’s nearly a 50% increase from the start of this year.”
KOSPI, which had plummeted from the Dubai World crisis, had begun to stabilize following Abu Dhabi’s intervention.
“How about Europe?”
Han Jae-yi rotated the monitor. A chart was displayed.
The upward curve was steep. The problem was, it wasn’t a stock price increase.
“Greece’s sovereign bond yield keeps rising. The ten-year is at 5.5%. That’s a 0.7 percentage point increase in just a month.”
Greece remained an unstable link, teetering on the edge of breaking at any moment.
“The spread between German and Greek sovereign bond yields is at its highest since the Eurozone was established. European bank CDS are rising in tandem.”
German sovereign bonds were the safest asset in the Eurozone. The widening spread with Greek bonds meant lenders were willing to lend to Germany at 1% interest, but wouldn’t lend to Greece even at 10% interest.
In other words, a widening spread between the two signified that Greece’s risk had reached a critical level.
“What’s our position?”
“Greece CDS from October—we’re holding at 23% yield.”
I looked back and forth between Jung Tae-sung and Han Jae-yi.
“Europe is going to shake next year.”
Han Jae-yi raised her eyes.
“Greece?”
“Not just Greece.”
I pointed to Han Jae-yi’s monitor.
“Ever heard of PIIGS?”
“Portugal, Ireland, Italy, Greece, Spain—the term for financially vulnerable nations grouped together, right?”
“Right. Greece will be the first to shake, but the issue is: who’s holding these countries’ sovereign bonds?”
Han Jae-yi thought for a moment, then spoke.
“French banks? German banks?”
“Yes. The entire European financial system is interconnected. If Greek sovereign bonds become worthless, French banks’ assets evaporate. Then Spanish sovereign bonds held by French banks get dumped en masse.”
“A domino effect.”
Just as Han Jae-yi said, a chain reaction was possible.
“When banks shake, the euro shakes. When the euro shakes, the dollar rises. That’s an opportunity for us.”
Han Jae-yi paused to think, then asked.
“Shouldn’t we increase our position size? A short position on the euro as well?”
“Not yet. Greece has a debt maturity coming due in January. The market will move then, and we’ll move with it.”
Han Jae-yi nodded. Jung Tae-sung listened quietly.
“So prepare so we can move together at that time.”
“Understood.”
“All right, that wraps things up—”
Buzz—
Just as I was about to end the meeting, my phone vibrated and I checked the screen.
“What’s so funny?”
Han Jae-yi asked as she stood to return to her desk. I was curious what my expression looked like, but that wasn’t what mattered.
“Director Jung, will you be heading to SJ Holdings?”
“Yes, that’s correct.”
“Then you’re free to go. You and I have somewhere to be, though.”
“Where are we going?”
Han Jae-yi asked with surprise at my words.
“Min-jae got his first paycheck and says he’ll buy us lunch. Let’s go shakedown Min-jae.”

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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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