A Few Conditions
The sale of Doa Motors was descending into pure farce.
Word that a German automaker had soured on the bid escalated into outright withdrawal. With no domestic company left to take Doa Motors off the table, the German exit threw the Korean markets back into chaos. The recently stabilized exchange rate and stock market began to lurch again. An international credit-rating agency that had already cut Korea’s grade to just above junk-bond status issued a statement saying it would “reconsider any upgrade,” a polite way of announcing that the foreign-exchange crisis was far from over.
The brand-new administration looked thoroughly rattled by the reef it had struck at the very start of its voyage. Stories even circulated in the press that President Kim Dae-sang had exploded in rage when the plan to restructure the business world—beginning with Doa Motors—collapsed at the first hurdle.
Bankruptcy for Doa Motors was no longer a remote possibility; it was becoming inevitable. On television a professor painted a grim picture of what would follow.
“If Doa Motors enters bankruptcy proceedings as things stand, the damage to the Korean economy will be severe.”
“Severe in what sense?”
“We have to leave open the possibility that the won–dollar exchange rate will break through its previous high.”
“Its previous high?”
The host, realizing that “previous high” meant two thousand won to the dollar—the level that had once signaled national default—could not hide his shock. He hastily composed himself.
“Is it really that bad?”
“It is.”
The professor nodded, face set hard.
“Doa Motors has more than five hundred affiliated companies. Add the second- and third-tier suppliers and you easily clear several thousand. Count the workers and the families they support, and you are talking about the livelihoods of hundreds of thousands of people tied directly to Doa Motors.”
“Hundreds of thousands… That’s a bleak number.”
“It doesn’t stop there. The regional economies where Doa Motors is rooted will collapse. The economic multiplier effect the company generates will flip overnight from positive to negative. Tens of thousands of export units that used to pad Korea’s trade balance every year will vanish from the books, and domestic demand will seize up.”
The host, left speechless by the professor’s words, could only lower his head. In a drained voice the professor closed the segment.
“Bankruptcy for Doa Motors is something we simply cannot allow. We must watch closely what solutions the government still has—and whether those solutions will actually help.”
Knock, knock.
Kim Seong-ho, who had been watching, lifted the remote and hit mute. He turned. His secretary entered, bowed slightly, and spoke.
“Director, the Ministry of Finance and Economy has requested a meeting.”
“Deputy Prime Minister Hwang calling again?”
“Yes.”
The secretary’s brief answer carried the silent question of what he should do. Seong-ho, remote still in hand, nodded.
“Clear every remaining appointment on the schedule.”
“All of them?”
The secretary looked momentarily flustered, then explained why.
“The executives from Ilhyeon Electronics are here ready to report on European handset sales…”
“I’ve already heard sales are strong. Have them submit it in writing. Tell them I’ll follow up myself if I have questions.”
“Understood.”
Seong-ho switched off the silent television and rose.
“Right now there’s something more important. Handle that first. Get the car ready—I’m going straight to the Ministry of Finance and Economy. And let them know I’m on my way.”
“Yes, sir. Right away.”
The secretary left. Seong-ho set the remote down, allowed himself a faint smile, and murmured,
“Well then—time to go claim Doa Motors.”
He headed for the ministry, ready to slip into his pocket the enormous bomb that, if it detonated in bankruptcy, could once again plunge the entire country into crisis.
When Seong-ho arrived at the Ministry of Finance and Economy, one more person was waiting than last time.
“Chairman Park—what brings the labor union here?”
Seong-ho regarded Park Geun-yong, labor-union chairman of Doa Motors, with open puzzlement. Park Geun-yong folded himself nearly double at the waist and apologized at full volume.
“I’ve come to beg the Director’s forgiveness for my past mistakes. Director, I am truly sorry. It will never happen again. Please, Director, forgive my wrongdoing.”
Seong-ho looked slightly taken aback by the spectacle of the union chairman bent double. Park Don-su, president of Modu Bank, smiled and said,
“Director, when a man apologizes like that, you ought to accept it, don’t you think?”
He glanced down at the still-bowed Park Geun-yong.
“I’ve had a long talk with Chairman Park. He deeply regrets what happened. He says he had no idea that agitators had infiltrated the union and simply got swept up. Isn’t that right, Chairman?”
Park Geun-yong lifted his head just enough to answer.
“Exactly so. Who could have known that people had slipped into the union for the sole purpose of driving a wedge between the union and the Ilhyeon Group? Everything that happened was their doing. Director, please show magnanimity and forgive us. We will never allow it to happen again.”
Seong-ho regarded the two men in silence, his eyes saying plainly, You’re the ones who drove that wedge between Doa and Ilhyeon. Neither man could meet his gaze; both looked elsewhere.
Into the quiet stepped Deputy Prime Minister Hwang Jang-chul, who had been watching the scene unfold.
“All right, let’s sit and talk. Director, please take a seat. Chairman Park, you may straighten up and sit as well. And let there be no next time.”
“Yes, Deputy Prime Minister. If anything like this happens again, I will resign the chairmanship.”
“It won’t end with resigning the chairmanship.”
Hwang Jang-chul fixed Park Geun-yong with a heavy stare.
“Next time the government will bring every statute on the books—including those covering illegal demonstrations—and hold you fully accountable.”
Color drained from Park Geun-yong’s face. Park Don-su dabbed cold sweat with a handkerchief and gave an awkward laugh.
“Yes, yes—just don’t do it again and everything will be fine. Sit down, please. Sit and let’s talk.”
He urged the tense union chairman into a chair, then invited Deputy Prime Minister Hwang and Seong-ho to sit as well. Taking Park Geun-yong by the shoulder, he sat first. Hwang settled into his seat with a look of open displeasure at both Parks; Seong-ho took the last chair. The four men faced one another around the round table.
Even after they were seated, silence lingered. Everyone knew why they were there, yet no one wanted to speak first. The quiet stretched until the man under the greatest pressure finally broke it.
“Ah… Director Kim. The reason we asked you here today is simply this: we want the Ilhyeon Group to participate in the Doa Motors bid. That is why we have gathered.”
Park Don-su spoke with extreme caution.
“Director Kim, on behalf of the creditor group I formally request—please… please enter the bidding.”
Every carefully prepared argument about the advantages of an Ilhyeon acquisition vanished from his mind. All that remained was the desperate need to cling to the Ilhyeon Group’s coattails. It was the only way both Doa Motors and Modu Bank would survive.
Hwang Jang-chul watched the pitiful bank president and the hangdog union chairman, then sighed. As host he could not simply sit and watch.
“Director Kim, if Doa Motors enters bankruptcy, Korea’s future will become completely unpredictable.”
He moistened his lips, closed his eyes, and reached for words that might move Seong-ho’s heart.
“Not long ago I saw a small child hold out a tiny gold ring with those stubby little fingers, asking that it be used to save the country. I watched an eighty-year-old woman give up the ring she had worn for decades, and a worker peel the gold plating from a twenty-year service plaque. I could not keep the tears from my eyes. How can we turn our backs on a people who have united as one to save their nation? Director Kim, for the sake of every Korean who has taken part in the gold-collection campaign, please enter the Doa Motors auction.”
Hwang opened his eyes, fully expecting to find Seong-ho’s eyes glistening. A few more words, he thought, and the man would reluctantly agree. Instead Seong-ho regarded him with pure puzzlement.
“Deputy Prime Minister, you seem to have forgotten: Ilhyeon itself is a company that has already sacrificed a great deal for this country.”
Seong-ho turned to Park Don-su.
“When the exchange rate soared and market rates went haywire, the banks and the rest of the financial sector locked their doors and refused to lend. Ilhyeon stepped in and did their job for them. We put out the fire. And that was only the beginning.”
He shifted his gaze back to Hwang.
“When the exchange rate was climbing and we were begged to release dollars to bring it down, we scraped every last dollar from our overseas branches and poured tens of billions into the market.”
Hwang’s mouth clamped shut. Even if one tried to dismiss it as the previous administration’s affair, the help Ilhyeon had given the government had been real and substantial.
“So what further sacrifice are you asking for? A few words of apology to soothe our feelings, and then, because a bankruptcy might sink the banks, Ilhyeon is supposed to swallow Doa Motors at a premium?”
Park Geun-yong and Park Don-su flushed scarlet. Hwang’s own complexion darkened. Seong-ho’s words had landed like barbs in all three men. Yet Hwang could not retreat. Failure to resolve Doa Motors risked branding him the shortest-serving deputy prime minister in history—and that would end his political career just as it was entering its prime. Swallowing the last of his pride, he turned to Seong-ho.
“Director Kim, please forgive me for the way I pressed you when we first met.”
The deputy prime minister apologized first, to a man twenty years his junior. Seong-ho quickly waved both hands.
“Forgive you, Deputy Prime Minister? That is hardly appropriate.”
“I behaved rudely even though people from other groups were present. I damaged your standing in front of others—that is a serious offense.”
“No, truly, I am fine.”
Even after Seong-ho’s repeated assurances, Hwang kept apologizing. Watching their superior lower himself so far, Park Don-su and Park Geun-yong grew steadily paler; the lower the new government’s economic deputy prime minister bowed, the blacker their own guilt became. Seong-ho looked at the two men—faces so ashen they seemed on the verge of collapse—let out a quiet breath, and spoke.
“All right… fine.”
Three pairs of eyes lit up, certain he was about to grant their request.
“So we only need to participate in the bidding?”
“No.”
Park Don-su answered in a rush; Hwang added at once,
“Exactly as the Chairman and His Excellency the President originally agreed—we want the Ilhyeon Group to acquire Doa Motors.”
“In other words, treat the bidding as a formality and arrange for Ilhyeon to take Doa in the end?”
“Precisely.”
Hwang swept a glance over Park Don-su and Park Geun-yong.
“We have come a long way around. What we want is simply that the original promise be kept. Can you do that?”
His eyes said clearly that if the two Parks had not interfered, the matter would have proceeded smoothly. He turned back to Seong-ho and waited, hope bright in his face.
Seong-ho considered for a long moment, then slowly shook his head.
“I cannot.”
“You cannot? You mean you will not even enter the bidding? Or that you will not acquire the company?”
“Neither. I mean I cannot do it the way we first discussed. We will enter the bidding and we will acquire the company. But I will have to attach a few conditions.”
“Conditions?”
Hwang asked, startled. Seong-ho recalled the terms of a previous life and began to speak.
“Write off the debt.”
“Of course we intended to. We were thinking of forgiving roughly two-point-five trillion—”
Seong-ho raised a hand and cut Park Don-su off.
“Please hear me out first.”
He stopped the bank president from reciting the old conditions and laid out new ones.
“First, write off three-point-five trillion won of debt.”
“Three-point-five trillion?”
Park Don-su of Modu Bank stared in shock. Changing the leading digit from two to three might sound minor, but the difference was a full trillion won.
“Forgiving three trillion is—”
“Not three trillion. Three-point-five trillion.”
Park Don-su tried to slide past the extra five hundred billion; Seong-ho did not let it pass. After a brief hesitation the bank president was ready to accept—after all, recovering nothing at all would be far worse, and a thirty-percent write-off was something he could swallow with a smile. Seong-ho spoke first.
“Debt forgiveness of three-point-five trillion is my first demand.”
“Your first?”
“Yes. The second is…”
The relief that had softened Park Don-su’s face at the mention of an Ilhyeon acquisition drained away to black. From Seong-ho’s mouth the conditions for Ilhyeon Group’s takeover of Doa Motors continued to pour forth without pause.