The Rule of Five Percent
“Look at them, making all this noise. All this noise over nothing.”
Chairman Kang Tae-yong of Sunjin Motors skimmed the report his chief secretary had brought in and tossed it carelessly onto the table.
“So Sunjin Aluminum has declared itself the white knight. Claiming it will defend Sunjin Sangsa's management rights from an assault by predatory foreign capital. What a tear-jerking display of family love.”
A sneer curled at the corner of Kang Tae-yong's mouth.
The whole situation was a comedy. The attacker was marching into the inner chamber sword in hand, proclaiming, I'm here to protect you.
“But Sunjin Sangsa's response is even more entertaining, sir. They've already fired back with an official statement saying they never requested a white knight, and don't want one.”
“Of course they did. Who's going to open the door to a robber while trying to dodge a thief? The newspaper desks must be tearing their hair out right now. On the surface it's a noble fight to defend management rights, but underneath it's a shares war between an uncle-in-law and his nephew's widow. Not an easy tone to strike in an article, I'd imagine.”
Kang Tae-yong clicked his tongue and shook his head.
“And my dear uncle — I told him plainly, didn't I? Settle things with Sunjin Group quietly behind the scenes first, then make your move. Build up your justification before you strike, I said, and nothing will go wrong. I spelled it out for him.”
“It seems Chairman Kang Byung-chul has a different idea in mind than you do, sir.”
At his chief secretary's careful words, Kang Tae-yong nodded.
“I suppose so. If he'd done as I told him, he'd have realized he'd have no choice but to pull me into the game. Take my help, and sooner or later he'd have to split the shares with me or hand over a slice of the management rights. That's what he couldn't stomach.”
Of course, the man who had set Kang Byung-chul in motion in the first place was Kang Tae-yong himself.
It was he who had let slip the information that Sunjin Sangsa's ownership structure was vulnerable, and he who had stoked the old man's appetite for the choice assets.
But the larger the game grew, the more blatantly Kang Byung-chul shut him out.
“Well, that's not necessarily a bad thing. He's volunteering to step up and grind the enemy down himself. Let's just sit back and watch. We can enjoy the show and eat our rice cakes while we're at it.”
For all Kang Tae-yong's relaxed air, the chief secretary's expression was grim. He hesitated a moment before speaking.
“Sir, there is a cause for concern. Chairman Kang Byung-chul might end up taking everything for himself.”
“Taking everything?”
“Yes. Sunjin Aluminum's financial firepower is overwhelming. Sunjin Sangsa, on the other hand, was ambushed before it could prepare. If Aluminum commits fully, Sangsa won't be able to hold out. Shouldn't we intervene now, then? Secure a stake before Chairman Kang Byung-chul swallows Sangsa whole — or at least throw out a checkmate move.”
From a conventional standpoint, the secretary's analysis was sound.
Viewed purely through the logic of force, it was a great barge ramming a rowboat. But Kang Tae-yong slowly shook his head.
“Hey, Director Yoon. If Sunjin Sangsa were that easy a meal, we'd all be in trouble.”
The chief secretary waited quietly for what came next.
“On the surface, Aluminum looks dominant, right? Wrong. Sunjin Sangsa is not meat you can just chew through and swallow. Have you gone over their financial statements carefully? They acquired several vessels not long ago.”
“Yes, I understand they've been expanding their fleet.”
“And do you know what that means? They haven't just been padding their size. By now their cash flow should be improving like mad. In other words — live ammunition for a war is piling up in their vault as we speak.”
Kang Tae-yong's eyes gleamed sharply.
“Besides, they're no isolated force over there, either. There are plenty of places they could still bring in as allies.”
“……Allies, you say……?”
“Treasury shares. That's what can be revived — that's my point.”
Still, doubt wouldn't leave the chief secretary's face.
“Who would accept such an offer, sir? Sunjin Sangsa is in a state of open war with Sunjin Aluminum right now. No domestic company is going to step forward to help them. One misstep and they'd face Chairman Kang Byung-chul's retaliation. No fool jumps into a fight with the odds this plainly visible.”
“Not domestically, no. The domestic business world is a cramped little floor where everyone's too busy watching everyone else's face.”
The whole landscape was tangled up in personal connections, school alumni networks, and hometown ties — who would dare come to the aid of a nephew's widow defying her uncle-in-law?
Kang Tae-yong snorted and went on.
“Overseas, though — there might be takers. No, there will be.”
“Overseas……?”
“Plenty of global companies would come running if you proposed a comprehensive share swap. Shall I give you an example? A global shipping line that needs an East Asian logistics hub, or the giant trading houses eyeing entry into the Korean market.”
Kang Tae-yong drew a breath and opened his mouth again.
“Those guys couldn't care less who Kang Byung-chul is or what the Sunjin family's traditions are. Profit, and profit alone. As long as the dividends flow and the stock price climbs, they're content. Sangsa hands over its treasury shares, takes their stock in return — everyone wins. And however deep Aluminum's pockets are, do you think they can afford to fight global capital?”
Only then did the chief secretary seem to grasp his chairman's intent, and his eyes went wide.
“There's still the new share issuance card left over, too. Launch a rights offering through third-party allotment and hand shares to friendly forces dirt cheap — Aluminum's stake dilutes to nothing in an instant. The money Kang Byung-chul poured in could turn into scraps of wastepaper. And that's not all.”
Kang Tae-yong swiveled his chair to face the chief secretary squarely.
“I know what you're worried about, believe me. My dear uncle is deliberately freezing me out right now. When this war ends, he'll claim all the spoils for himself, cement his position inside the group, and eventually start eyeing Sunjin Motors as well. What do you suppose his real intention is?”
“…….”
“He doesn't want to share. Can't stand the sight of so much as one extra spoon at the table. But he showed his hand far too early. Flipped his cards way too soon. And do you know why?”
The chief secretary said nothing. Kang Tae-yong tapped his own temple with his index finger.
“My dear uncle simply can't do this.”
“…….”
“He spent his whole life running factories under my father's wing, eating the oil money. He may be competent at the manufacturing mindset — build a good product, sell it at a fair price. But he is not the man to lead a shares war that demands financial engineering of this sophistication.”
Conviction rang clear in Kang Tae-yong's voice.
“Look at what Chairman Kang Byung-chul is doing right now. It's the equivalent of walking up with a bundle of cash and yelling, hand it over. No calculation of what defensive logic the other side holds, no sense of how market sentiment is turning. When greed outruns reason, defeat is guaranteed.”
Kang Tae-yong gave a dry chuckle.
“Let's wait and see. Aluminum attacks, Sangsa defends — the mud fight will drag on and on. Aluminum's stock price will swing wildly, and Chairman Kang Byung-chul's funding lines will start to run dry. When it stops working, he'll come calling.”
“You intend to move at that point, sir?”
“Of course. By then I'll extract more than I could ever have gotten up front. We're not the ones in a hurry. They are.”
At the end of Kang Tae-yong's explanation, the chief secretary nodded, and Kang Tae-yong — who knew better than anyone that the moment had not yet come — let a sneer slide across his lips.
I sat down at my desk and rested my chin on my hand.
A test-prep book lay open on the desk, but my eyes weren't taking in a word of it.
So Sunjin Aluminum's weakness is Kang Byung-chul himself.
The reason was obvious.
Kang Byung-chul was not a man who listened to anyone around him. And his appetite was bottomless.
Even in my previous life, the reason a relatively weak Sunjin Sangsa had been able to withstand and repel Sunjin Aluminum's assault was entirely thanks to Kang Byung-chul's headstrong foolishness.
Come to think of it, it's a blessing Sunjin Sangsa's first opponent was Kang Byung-chul.
No matter that I was living my life a second time, no matter how thoroughly I had prepared so I wouldn't be caught off guard — the gaps were still there.
But Kang Byung-chul remained incompetent enough, and greedy enough, to more than cover for my shortcomings.
And this time too, Kang Tae-yong will keep his distance, won't he?
I knew. I knew that it was his eldest uncle, Kang Tae-yong, who had egged Kang Byung-chul on.
Kang Tae-yong was every bit as greedy and vicious as Kang Byung-chul, but he was at least a man who understood how to conduct himself at the M&A table.
Of course, even he wouldn't be a match for me.
But Kang Byung-chul had shut out even that man's counsel — so this life's attack would unfold no differently.
Knock, knock—
I was deep in the middle of organizing my thoughts when the knock came.
“Yes.”
The door opened and my mother walked in. So it's finally come.
“Not asleep yet?”
“Ah, I was studying. The college entrance exam is this year, after all.”
“Then will you talk with me for a little while?”
“Of course.”
My mother came into the room and sat on the edge of the bed. And then she simply looked at me in silence.
The silence stretched on.
Ha. I should be the one to speak first.
“Mom. I went to see Managing Director Kim Seok-jun.”
At my words, my mother nodded and simply listened.
She had probably been waiting for me to bring it up first.
“I sat in with Father many times when he met Managing Director Kim. I was only a child then, of course, but Father told me each time that Kim Seok-jun was a man I could lean on when it mattered.”
It was the truth. Even after I came back, the reason Kim Seok-jun had been the first person I sought out was that my father's words had stayed with me.
“So I went to him and asked for his help. That's all there was to it.”
He would have heard the rest from Managing Director Kim anyway.
My mother spoke quietly at last.
“What made you think of that? I mean it — what made you think of going to Managing Director Kim Seok-jun?”
“I could see the company was in trouble. Granduncle Byung-chul said he'd help us, but I don't believe him.”
At my words, a flicker of something passed through my mother's eyes. From her standpoint, her son — whom she had always seen as a mere child — had suddenly grown up before her eyes, and it must have pained her.
“I trusted that you would handle things well, but I thought there might be an easier road, too. I'm sorry. I was being presumptuous. I should have talked it over with you first.”
Only then did my mother smile.
“No. I wasn't trying to scold you, Seon-woo. I was only curious what had put that idea in your head.”
Taking my hand, she added softly,
“And Managing Director Kim's help really is a great source of strength for me, too.”
She gazed at me for a long moment before speaking again.
“But Seon-woo, next time — will you talk to me first, before you do anything like that?”
More than anger, worry had settled across my mother's face.
“Seon-woo, I know you've been worrying about me lately, and telling me this and that about the group's affairs, but from a mother's standpoint, it doesn't sit easy with me.”
Her face said she grieved the very situation itself — that her young son had felt compelled to step into such matters and act.
“What you've done has helped me, but you're at an age when you should be studying, aren't you? The grown-ups' work — could you leave that to the grown-ups, just a little?”
“Yes. I understand. I'm sorry.”
“Good. Though I can't exactly tell you to study less, can I? Get to bed early.”
“Good night, Mom.”
After my mother left, I let out a long breath.
I'd gotten past that hurdle, but it left a certain discomfort behind all the same.
Still, once this business is finished, there'll be no reason for me to get involved in the group's affairs for a good while.
I was still turning that over in my mind when my phone buzzed. Checking the screen, I saw it was Jung Tae-sung.
“Yes, Director.”
On the way home that evening, Jung Tae-sung, the trustworthy attorney he had brought along, and I had discussed what was to come.
— President, it's Jung Tae-sung. As you asked this afternoon, we've traced Sunjin Aluminum's acquisition records of Sunjin Sangsa shares.
“What did you find?”
— It does appear they've been accumulating for quite some time. And as you suspected, President, there are grounds to question whether they violated the five-percent disclosure rule.
The five-percent disclosure rule.
A regulation requiring that anyone holding five percent or more of the voting shares of a listed company report their purpose of acquisition and the size of the stake within five days.
“You're saying they may have blown past the five-day deadline?”
In my previous life, Sunjin Aluminum had made the exact same mistake.
They had bought up shares covertly, parking the positions in scattered lots, and botched the tally — failing to grasp the moment their holdings crossed the five-percent line.
Kang Byung-chul's incompetence layered atop his staff's complacent error.
That was the full picture of how the weak Sunjin Sangsa had beaten Sunjin Aluminum.
— Yes, that is correct.
“Good. Then report it to Managing Director Kim Seok-jun right away, and let's file a formal petition with the Financial Supervisory Service under SJ Holdings' name.”
I smiled as I spoke to Jung Tae-sung.
“Ask them to strip Sunjin Aluminum of the voting rights attached to every share it holds.”