The Acquisition of Korea Aerospace
“Are there any other questions you’d like to ask?”
“If we intend to export the T-50 as an attack aircraft rather than just an advanced trainer, it seems we’ll need to enhance its armament capabilities. Do you have a plan for that?”
Director Jo sighed. “The aircraft’s development costs were funded by the government; do you honestly think there’s a budget left to enhance its armament? I’m part of the management team, but no one is showing any interest. We’re currently wallowing in self-pity, thinking that just developing a supersonic fighter in South Korea is an achievement in itself. How could we possibly talk about future plans?”
“If additional capital were injected into Korea Aerospace, what would be the most urgent priority?”
Director Jo Yun-je looked at Taesik’s question with a puzzled expression. “Why are you asking such a question all of a sudden…?”
“Haven’t you heard the recent news about Korea Aerospace being put up for sale? Once it’s sold, wouldn’t additional investment be the natural next step?”
“Well, if it’s sold, the executives will all have to submit their resignations, so that’s a question that doesn’t apply to me. If additional investment funds were to come in, we would need to increase the armament capabilities of the T-50’s derivative models and convert it from a two-seater to a single-seater to boost exports. And if there were even more funds, we should develop a fighter with a wider operational radius. Oh! And we must develop unmanned aerial vehicles at the same time.”
“If someone like you, Director Jo, were appointed as the CEO, Korea Aerospace would surely change.”
Director Jo hurriedly looked around. “If people around here hear that, I’ll get fired. It’s a company I’ve wanted to quit at any time, but since this is the only place in Korea that manufactures aircraft, I have nowhere else to go.”
As the T-50 mass production launch ceremony began, Taesik moved to the venue, where Major General Choi Young-gyu of the Ministry of National Defense greeted him.
“How does it feel to visit Korea Aerospace in person?”
“Once I acquire it, I can see a few areas that need fixing. Has the schedule from the government been released?”
“They say the public notice will be out within this month. The Ministry of National Defense has already submitted an opinion that there would be no issues if a Korean company acquires it, and the National Intelligence Service is currently conducting further reviews.”
As the ceremony began, the CEO of Korea Aerospace requested the government’s cooperation, stating that they were staking everything on the mass production of the T-50 and the upcoming development of the Korean-type utility helicopter. Meanwhile, event officials engaged in personal lobbying, asking for positions at Korea Aerospace after their retirement.
Manager Park, listening to the requests for post-retirement jobs nearby, whispered, “I didn’t know companies with government-held shares were at this level.”
“Once we acquire it, we’ll have to clean house.”
As soon as the ceremony ended, the two returned to Seoul, and Taesik received a call he had been waiting for from Dae-A Motors.
“Executive Director Jung! Have you finally reached a conclusion?”
“There’s a 5% premium, but it comes with additional conditions. Would that be acceptable?”
“Additional conditions?”
“I received instructions to proceed with the sale on the condition that the patent rights for the camera-based all-around view and lane-keeping assistance be transferred to Dae-A Motors. It seems the management has analyzed that the features proposed by Starlink will provide a significant advantage in automobiles.”
“Then, what happens to the software and the navigation terminal?”
“We’ve decided to use Starlink’s navigation terminal and maps as they are.”
Taesik was disappointed that they were taking the future technology he had proposed in exchange for the Korea Aerospace stake. He resolved not to engage in any future-related deals with Dae-A Motors again and replied, “Fine. I will modify the contract to include the terms requested by Dae-A Motors.”
After finishing the call with Executive Director Jung, Taesik called Cha Youngjin, the CEO of Starlink Deepmind, and Researcher Lee Sang-hoon, who was developing the lane-keeping assistance feature. Lee Sang-hoon, who had joined Starlink after completing his master’s degree, entered the office wearing jeans and a hoodie, and Taesik welcomed his junior warmly.
“Sang-hoon! Is company life manageable?”
“Senior! No, I mean, CEO! Where else would you find a company that supports the research projects I want to do? I’m very satisfied.”
CEO Cha Youngjin watched the conversation with Sang-hoon before getting to the point.
“CEO, why did you call us so suddenly?”
“The lane-keeping assistance development project, which we decided to conduct as a collaboration with Dae-A Motors, has been canceled. They asked us to hand over the patent rights in exchange for purchasing the Korea Aerospace stake.”
CEO Cha Youngjin looked at Sang-hoon’s face. “Researcher Lee Sang-hoon! Are you okay with that?”
“It’s for the best. Lane-keeping assistance is such a simple technology that it doesn’t mean much anyway.”
Fortunately, Researcher Lee Sang-hoon said it didn’t matter at all and told them not to worry, then presented a suggestion to Taesik.
“CEO, it’s a project that requires too much research funding, so I haven’t been able to bring it up to CEO Cha, but would it be okay if I participated in the autonomous driving competition hosted by DARPA (Defense Advanced Research Projects Agency) next year?”
Researcher Lee Sang-hoon expressed his desire to participate in the U.S. autonomous driving competition with the technology he was developing, and Taesik immediately gave his approval.
“Sang-hoon! I’ll support whatever research funding you need!”
“Thank you, Senior!”
His junior, Sang-hoon, was delighted that he could conduct unlimited research on a project with a higher level of autonomy instead of the simple lane-keeping feature for Dae-A Motors. After sending Researcher Lee Sang-hoon out, CEO Cha Youngjin immediately asked a question.
“The collaboration with Dae-A Motors has fallen through. Will that be okay?”
“It couldn’t be helped if we want to acquire Korea Aerospace. If this collaboration had succeeded, I had other plans, but if Dae-A Motors doesn’t want to collaborate, what choice do I have?”
“Dae-A Motors has kicked away their own fortune.”
“More importantly, there is an item to be developed at Deepmind. I would like you to create an AI-based fighter pilot program.”
“That’s a research project similar to the one Researcher Lee Sang-hoon is conducting. However, there is a problem.”
“What is it…?”
“Autonomous driving programs for cars can easily obtain data, but there is nowhere to get data for aviation. If we cannot secure the data for the AI to learn from, it’s hard to expect the program to be complete.”
“I will take care of that. For now, please start with the conceptual research.”
Having instructed CEO Cha Youngjin to develop the AI program for fighters, Taesik called the Misung Group, which had not yet sent a response.
“Vice Chairman Jeon Hak-soo. This is Kim Taesik from Starlink. I’ve decided to acquire 10% of Korea Aerospace stock from Dae-A Motors, but I haven’t heard back from Misung yet, so I’m calling. Do you need more time?”
“No. I received the Chairman’s decision this morning. The Chairman instructed me to sell it immediately if you accept the proposal.”
Following Dae-A Motors, Misung also made a proposal, and Taesik sighed.
“What is Misung’s proposal?”
“It’s for you to serve as an advisor to Misung Electronics.”
“Pardon…?”
“You have your own company to run, so you don’t need to come to the office. You just need to review our management strategy once a year. Would that be alright?”
Taesik was taken aback by Misung’s proposal. “I’m sure Misung has plenty of talented people…”
“The Chairman seems to think highly of you! Don’t feel burdened, just take the position as an advisor to Misung Electronics.”
“Understood. I’m in a situation where I desperately need the Korea Aerospace stock, so I have no choice.”
“We will sell the stock on the date you want, so call me when you’re ready.”
Having unexpectedly become an advisor to Misung Electronics, Taesik called Luke at WP Morgan to raise funds for the Korea Aerospace acquisition, informing him that he would sell his Google shares. As Major General Choi Young-gyu of the Ministry of National Defense had mentioned, the government announced the sale of Korea Aerospace stock, and Taesik visited the Korea Development Bank with Manager Park.
Following the announcement that the buyer would be decided through a bidding process, Taesik arrived one hour before the deadline and found the designated office, where he discovered people yawning and waiting for bidders. The Korea Development Bank officials, knowing that major domestic conglomerates were not interested in acquiring Korea Aerospace stock, were chatting while reading newspapers. They looked at Taesik’s group as they opened the door and entered, asking with curiosity.
“Are you here to bid for the acquisition of Korea Aerospace stock?”
“Yes. Is there anyone else bidding besides us?”
“No. So far, no bidders have come. Where are you from?”
“Starlink.”
“Ah! You’re the company that recently entered the defense industry.”
The Korea Development Bank officials offered Taesik the refreshments they had prepared. “Finally, a buyer has appeared. Would you like to submit your proposal right away?”
“No. I will wait to see if there are any other bidders before submitting.”
The officials confirmed Taesik’s intention again, saying there would be no problem submitting the bid immediately as there would likely be no other bidders besides Starlink. Since Taesik had prepared two copies of the proposal just in case, he decided to wait until the very end.
The Korea Development Bank official was pleased that he would wait until the end and offered friendly words, saying they would provide a loan if he needed funds for the acquisition.
When the bidding deadline reached 15:00, Taesik submitted the bid proposal at the prepared minimum price, and the Korea Development Bank official handed him a receipt and congratulated him on the acquisition of Korea Aerospace. Since there was plenty of time before the remaining balance had to be paid, Taesik left the bidding hall while calculating the money to be paid to Misung Group, Dae-A Motors, and the Korea Development Bank.
Because the money earned from Google shares was insufficient to acquire Korea Aerospace, Taesik paid the acquisition price after receiving an additional loan from WP Morgan. After receiving the collective resignations of all Korea Aerospace executives through Manager Park, he visited Korea Aerospace for the official acquisition procedure.
At the main gate of Korea Aerospace, people who appeared to be union members were lined up on both sides of the gate, wearing red headbands. Taesik passed through the union members who were shouting at his car and moved to the main building.
CEO Kim Seok, whom he had seen at the T-50 production launch ceremony, was nowhere to be seen, and the remaining executives, including Director Jo Yun-je, came out to greet Taesik’s group. As Taesik got out of the car, Director Jo Yun-je recognized him but led him to the conference room without a word. When Taesik arrived where the executives were gathered, he immediately sat in the chairman’s seat.
“I am Kim Taesik, CEO of Starlink. Are there any government officials or former military personnel among you?”
Seeing a few of the executives raise their hands, Taesik said, “There are no jobs for you. Please leave the conference room immediately.”
The conference room froze at Taesik’s declaration, and Taesik immediately delivered the prepared statement.
“The employment of all general staff will be fully retained, and the remaining executives will be evaluated once a month to determine whether they will remain.”
At Taesik’s words, the executives who were not former government officials sighed in relief, and the headquarters staff who had entered to assist with the meeting were reassured by the statement that all employees’ employment would be retained.
“From now on, Korea Aerospace’s company name will be changed to Starlink Aerospace, and Director Jo Yun-je will serve as the CEO.”
Director Jo Yun-je looked up in surprise at Taesik’s words, and the surrounding executives looked at Director Jo Yun-je in astonishment, as they had not expected him to be selected as the interim CEO.
“CEO Jo Yun-je, please establish the management strategy for Starlink Aerospace and bring it to me by this week. Please include the modification plan for overseas sales of the T-50 aircraft and the development plan for unmanned aerial vehicles in the management strategy.”
After asking for the understanding of the other executives and staff, Taesik moved to the CEO’s office with interim CEO Jo Yun-je, who followed Taesik hesitatingly.