Breaking Up Is Better Than Divorce

performance announcement

There were other video conferencing system companies that Eugene invested in besides Zoom.

Discord was just starting out, so it was able to get a 46% stake for $50 million.

There is not much time left for this one to grow more than 100 times.

Of course, Eugene also banned Discord from being used for work.

Discord is excellent as a messenger for games, but it cannot be free from security issues such as continuous hacking and malware spreading.

In the end, what the company used was a video conferencing system of Webex, a collaboration software serviced by Cisco, a traditional network powerhouse.

The picture quality is not very good, but it is because it is the most stable in terms of security.

Of course, Webex is also not completely free from hacking, so there is a problem of being able to attend meetings as a ghost user and overhear them.

In the main gate, if possible, the video conference was instructed to only deliver content that does not require much security.

“And it was announced that Daeyang Motors had decided to acquire Maxwell Griffiths.”

At the end of the report, Hwan Kim gives additional news.

Eugene immediately clicked on the link sent by Kim Hwan and looked for the report.

[Maxwell Griffiths is an electric vehicle company founded in Salt Lake City by an engineer from Tesla, and is known for its leading technology in the electric vehicle industry.

As the European Union countries such as Norway and the Netherlands recently passed a bill to ban the sale of internal combustion engine vehicles after 2025, the automotive industry has strengthened environmental regulations, and the need for the development of eco-friendly vehicles such as electric vehicles has increased. said.

The acquisition price of Maxwell Griffiths is known to be about 200 million dollars, and Daeyang Motors decided to issue convertible bonds (CBs) to finance the necessary expenses.]

“The price is lower than I thought.”

While Eugene was checking the report, he threw a word to Kim Hwan, who was silently waiting on the other side of the screen.

“Isn’t $300 million too high to buy a company that hasn’t even launched a single electric car yet? Even if you are from Tesla, you are not an early member, but a company founded by just one general engineer. Atieva, founded by the founders of Tesla, is only worth $200 million. Actually, that’s absurd. They didn’t reveal any great technology, they were all just paper plans.”

“Of course it is, but in the next two or three years, the value of the electric vehicle industry will increase tenfold from what it is now.”

“Isn’t Daeyang in urgent need of funds?”

Most of the $300 million Daeyang pays to acquire Maxwell Griffiths will go through Maxwell Griffith’s investors NT Somerset and TBD Ventures, then back to United Excellence and DL Capital.

Eugene already knew that DL Capital is a private equity fund that manages the overseas funds of the owner family of the Daeyang Group, and David showed his skills to confirm that United Excellence is the same.

In the end, the acquisition of Maxwell Griffiths was said to be a scam to fill the slush funds of the owner family of the Daeyang Group.

“Hmm… is it time for that?”

Eugene is well aware of what happened to the Daeyang Group in the second half of 2016. If you suddenly need money, that’s probably it.

“Okay first. I’ll give you instructions later, so the first thing you need to do is to keep an eye on the actions of the Daeyang Group.”

“All right.”

The screen went off, and Eugene found Joanna.

“What is the current status of Daeyang Heavy Industries’ stake?”

“Daeyang International 8.6%, Daeyang Corporation 6.5%, Daeyang Card 5.2%, Daeyang Fire 4.1%, Daeyang Group’s owner family 6.5%, holding 30.9% of Daeyang Group, National Pension Service 7.3%, Vanguard 6.7%, First Trust 5.6 % and other overseas asset managers and funds are 39.4%, of which we own 31.2% through eight.”

Thanks to the understanding and steady purchase, Eugene’s stake was already much larger than that of the Daeyang Group.

The reason for dividing it into so many places is because it is not known to the Daeyang Group.

Due to the stock ownership reporting system under the Capital Market Act, if a company holds more than 5% of a stake in a listed company, or if there is a change in its stake of more than 1% since then, it must be disclosed.

However, using over-the-counter derivatives such as TRS (Total Share Swap), you can buy stocks regardless of disclosure.

If you purchase substandard stocks through an asset manager, private equity fund, hedge fund, investment bank, etc. and then hand over them to one place through a block deal when the time comes, you can accumulate enough stocks before the other party notices it and start a management dispute. there will be

These derivatives are often used to purchase stocks without disclosure in a legal way because the legal ownership principle of stocks and the subject of profits obtained through stocks can be separated according to their design.

Not only Eugene but also many companies hide their identity in this way and hold shares, then move them to a desired location when necessary, or exercise their rights through a power of attorney.

“If we are 31.2% out of 39.4%, we have very little hidden stake in the ocean.”

Eugene was thinking that Daeyang Group would have a significant stake through overseas investment institutions like himself.

However, if Eugene owns 31.2% of the 39.4% owned by foreigners, only 7% remains.

No matter how I think about it, I don’t think it’s that small.

If so, it can be assumed that the stakes he held are already sold under the guise of a foreigner.

“How is the short selling situation?”

Let me make one more check.

“The proportion of short selling is 43% and the current balance is 32%. Unusually high.”

“It looks like they are preparing for it.”

The fact that short selling accounts for more than 40% of Daeyang Heavy Industries’ stock trading volume means that the market is expecting a decline in the stock price.

In addition, 32% of the total issued stocks were loaned to other institutions by owners, indicating that it was highly likely that they were used for short sale or borrowed for short sale.

It is also an indicator of a decline in stock prices.

“Are you trying to bring down the stock price by bursting with bad news?”

“uh. No doubt.”

After understanding the details of Daeyang Heavy Industries with Joanna, I have a feeling that it is more certain.

That afternoon, Eugene contacted Kim Hwan of Korea.

“Daeyang Heavy Industries will announce the results soon.”

“Since the shipbuilding market is at its worst, the stock price will fall a lot when earnings are announced.”

“maybe. By our analysis, it will drop to at least half. So, start buying when it drops 40% from the current price.”

“All right.”

As Eugene said, within a few days, Daeyang Heavy Industries announced its earnings.

[Daeyang Heavy Industries is known to have made a large-scale deficit in the trillions of dollars this year alone. According to the financial authorities, it is estimated that Daeyang Heavy Industries suffered an operating loss of up to 3 trillion won in the second quarter of this year alone. In addition, it is known that the size of the deficit, which has not been reflected in the earnings so far, is close to at least KRW 2 trillion.]

[It is said that the large-scale loss of Daeyang Heavy Industries was largely attributed to the offshore plant business, which was competitively won in the domestic shipbuilding industry before and after the financial crisis. Due to the pursuit of the Chinese shipbuilding industry, we focused on winning high-priced offshore plant orders instead of existing low-priced ships, but due to the recent ultra-low oil price, companies that ordered offshore plants are refusing to deliver the orders.]

[Daeyang Heavy Industries & Construction’s loss is known to be larger than expected, and the stock price continues to plummet.]

As scheduled, Daeyang Heavy Industries & Construction induced a share price decline by unraveling the scale of insolvency it had been hiding.

The shipbuilding industry’s deficit is not unique to Daeyang Heavy Industries.

Dasan Heavy Industries, the No. 1 player in the industry, also announced a loss of more than 3 trillion won at the beginning of the year, and Cheil Heavy Industries also suffered a significant loss.

However, in the case of Daeyang Heavy Industries, the impact on the market will be even greater, as the company recorded a loss of 2 trillion won in the last quarter and before, and reflected a huge loss of more than 5 trillion won in all at once.

On the morning of the day after the earnings announcement, the elderly and their children were gathered in the living room at the home of the chairman of the Daeyang Group, much later than usual, past 9 o’clock.

On this day, the old man did not come even for the regular breakfast, and only the two sons had it with the other family members.

“Did you say it went down to the lower limit yesterday?”

The chairman of the Daeyang Group, who had been suffering from old age for a while, and recently regained his energy, asked in a voice that was weaker than before.

“yes. It was a brief moment after the announcement was made. And today, as soon as the market opened, it started to fall. It dropped to 22,000 won a while ago.”

The second, Geun-il Ryu, who took the lead in this case, answered.

As expected, the announcement of a loss of 5 trillion won gave the market a huge shock. And there were still many shareholders who were desperate to sell.

“How much do you have now?”

“It’s 30.9%.”

“okay. How have you been selling in the meantime?”

“The 12.2% we had as an offshore fund has already been sold. Short selling is about 33.4%.”

Much of the balance of the balance that Eugene found out was due to their events.

That’s a huge amount of short selling. Normally, such a large amount of short selling does not come out in the market.

This is because if you pour too much short selling, it will be difficult to catch up.

However, the Daeyang Group owner family was already planning to announce the largest deficit in history, so they were able to do the work without pressure.

“We recovered 1.9 trillion won in all.”

It has been selling slowly for nearly three months, adjusting so as not to have a major impact on the market.

Nevertheless, it fell not a lot, but it was a satisfactory amount because it was carried out perfectly according to the operation.

The fact is that Eugene bought most of the stocks they sold, so the stock price didn’t drop that much, but there was no way to know that.

“If it wasn’t for him, I could have sold it for a much better price.”

The eldest son said as if he was about to explode.

“If it weren’t for that damn bastard, I would have gotten 400 billion more.”

Ryu Geun-il has a similar expression.

Currently, the market cap of Daeyang Heavy Industries is approximately KRW 4 trillion. Compared to the previous high in 2011, it is about a third away.

Ryu Geun-il was calculating that if he hadn’t been entangled with Eugene, he would have maintained more than 2 trillion won.

“What is the target price? Was it about two thousand won?”

The old man asked the second again. Ryu Geun-soo, the third person who recently resigned as president of Daeyang Heavy Industries, was not seen here.

Instead of taking responsibility for the situation and resigning, he was exiled to an overseas branch.

Going into exile like that at the age of 50 is not uncommon for a chaebol family. This incident was a testament to the fact that the Daeyang Group was still in the hands of Chairman Roh.

“It’s 14,000 won. If you hit the lower limit three times, it will probably be near the bottom.”

Ryu Geun-il answered.

Daeyang Group expects the share price to drop by at least 60% due to the announcement.

In that case, it would be down to 1/10 level compared to 2011.

In fact, at this time, the stock prices of Dasan Heavy Industries, Jeil Heavy Industries, and Daeyang Heavy Industries, which are called the Big 3 of the Korean shipbuilding industry, were almost at that level.

As such, the Korean shipbuilding industry was in a grave crisis.

However, Jeil and Dasan had already hit the bottom by reflecting their losses in their earnings and their stock prices were gradually rising.