What Happened in Riyadh (1)
Continue Capital’s assets were worth about $23 billion.
During the Blackwood crisis, that number had ballooned to $16 billion, and $2 billion of it had gone straight into the deposit for the Legend Games acquisition.
Then, thanks to betting against LD Studio’s decline, I’d pushed it all the way up to $23 billion.
On top of that, Continue Capital had pulled in the remaining $20 billion from the Rush Fund.
To do it, we’d set up a paper company and moved the money through that channel.
A hedge fund or private equity firm that collected client money to operate couldn’t make investments like this under the regulations.
But Continue Capital was a Family Office.
Unlike ordinary asset managers, who faced heavy investment restrictions and disclosure obligations, a family office only had to follow the bare minimum of regulations, so long as it stayed on the right side of the law.
If the money was mine, and I wanted to invest it, who was going to complain?
It wasn’t easy to throw that much money into a single trade, but fortunately, Kionos was the largest company Continue Capital had ever shorted. As Japan’s biggest semiconductor firm, its market cap was well over ten trillion yen.
That made it possible to take a much larger short position.
Before I executed the breakout operation, I poured everything I had into shorting Kionos.
And after Chairman Samara’s escape, once the full-blown scandal broke, the stock naturally evaporated by around 60 percent.
Again, this wasn’t some small or middling company. It was one of the five biggest semiconductor firms in the world.
In just ten days, six trillion yen of market capitalization vanished.
Thanks to that, Continue Capital booked $14 billion in profit, and the Rush Fund made another $12 billion.
In a single investment, we’d earned the money needed to acquire Legend Games.
Chairman Samara had also taken his own share.
Since his goal had been to recover the bail money he’d lost and the severance pay he’d never received, he’d used CFD trading to add leverage and secured the exact amount he wanted.
When he saw the profits, Chairman Samara was extremely pleased.
No wonder I was thanking him without even thinking about it.
I called the person in charge of operating the Rush Fund.
“Did you check the report Continue Capital sent over? I put the return rate in there.”
Sarah sounded stunned.
[I saw it. I still couldn’t believe it while I was reading it... Is that return real?]
“I told you. If you team up with me, you’ll make a fortune.”
[So this is what they mean when they say money gets copied. I never imagined you’d make it this way.]
A sovereign wealth fund might buy risky assets, but it would never invest like this. If something went wrong, there was no way it could bear the responsibility.
This was only possible because Saudi Arabia’s national wealth was, in effect, royal wealth.
[To think you could make that kind of profit in such a short time with this amount of capital. I don’t think I’d be able to do it even if I died and came back.]
“Well, just dying and coming back wouldn’t be enough.”
You’d need to regress ten years the way I had.
[The whole semiconductor industry’s been in an uproar over this. Do you think SPME can absorb Kionos?]
“That’ll be difficult.”
SPME currently held 46 percent of Kionos.
If they bought just 4.1 percent more, they’d secure a majority of the shares.
Someone might think they could simply force an M&A that way, but if it were that easy, they would have done it already.
The reason it wasn’t possible had to do with the special nature of the semiconductor industry.
Semiconductors were a core strategic industry tied directly to economic security. Any merger required approval from the relevant government.
“But they’ll probably keep trying to push through a management integration through the alliance. Until then, the conflict will keep dragging on, and future investment won’t be easy.”
Even if they invested now and expanded the factories, real production would only begin two or three years later at the earliest.
Right now, I was the only one who knew, but in five years the entire industrial landscape would have changed. If they hesitated even for a year now, the gap later would become impossible to close.
[That means Glory Electronics will benefit from the spillover, then.]
As Kionos, the memory semiconductor rival, stumbled, Glory Electronics’ stock rose again and fully recovered the losses it had taken after announcing its entry into the data center industry.
Rush Fund had poured $11 billion in at the bottom and bought roughly 2 percent, so it had profited on both sides.
The problem was...
[A lot of people are suspecting Continue Capital might be behind this incident.]
“Suspicion is free. Anyone can do it.”
In finance, rumors spread faster than words.
Continue Capital had partnered with Glory Electronics through Snow Crash.
Maybe because of that, people in the financial world were suspecting, or rather, were almost convinced, that the group that had unloaded massive short positions right before the collapse was Continue Capital.
After all, there weren’t many firms that could move that much money into shorts all at once, and Continue Capital already had a record of hammering down the stock prices of major companies using all sorts of outlandish methods.
Still, it seemed they only thought I’d gotten hold of information in advance and used it to profit. They probably couldn’t imagine that I’d actually planned the breakout myself.
That was because it was so far outside the bounds of common sense.
“It sounds like Chairman Samara still wants to keep working. Is there anything he could do in Saudi Arabia?”
[Of course. Competent managers are always welcome.]
Even the Japanese press, which had denounced him as a devil, never doubted his ability as an executive.
Saudi Arabia was carrying out a series of reform policies under Prince Rashid’s leadership, but finding the right people was never easy.
The higher up you went, the harder people were to find.
[Though an official title might be difficult. We’ll have to think about our relationship with Japan, too.]
After all, he was a criminal who had escaped trial in Japan. It would probably be awkward to put him to use directly.
“If we look for a way, we’ll find one. It should be fine if we pay him enough.”
Sarah agreed with me.
[More than that, the Japanese government will be furious about this. Especially about you, Miru.]
“I don’t care.”
They screwed up and then wanted to blame me?
However much they investigated, they would never find proof that I’d been directly involved. The money paid to the Cullen brothers and the money needed to carry out the plan had all moved through paper companies.
And if anything happened to me, wouldn’t Saudi Arabia help?
After all, they’d made plenty of money because of me.
“By the way, where are you right now?”
[I’m in Riyadh for a bit.]
“What brought you to Riyadh?”
[Well, that’s...]
* * *
Riyadh, the capital of Saudi Arabia.
Under the king’s orders, Prince Rashid was investigating corruption within the royal family. It wasn’t something to boast about, but in Saudi Arabia, royal corruption was practically a daily routine.
It wasn’t a matter of finding no dust when you swept; if you touched anything at all, dust burst out in every direction.
As the investigation continued, one by one, the crown prince’s close aides were arrested.
By the time Crown Prince Khalid came to his senses, both his hands and feet had already been cut off. And now Prince Rashid’s blade was pointed at the crown prince’s own family.
Cornered, Crown Prince Khalid met Prince Rashid in person and spoke with him for three hours.
After that, he announced that he would step down from the position of crown prince and proclaimed Prince Rashid the new heir.
The image of a crown prince in his sixties bowing his head to a prince in his thirties was broadcast to the entire world.
“I pledge my loyalty to you. God will bless you.”
The young prince took his hand firmly.
“I need your experience and advice. I ask that you become my patron.”
“I will do so with pleasure.”
On the surface, it looked like a warm, almost touching scene of cousins generously yielding a seat to one another.
King Abu Barak issued a royal decree deposing Khalid, the crown prince and minister of the interior, and appointing his fifth son, Rashid, as crown prince.
And just like that, Rashid rose to the position without shedding a single drop of blood.
That meant far more than a simple change in crown prince.
It meant the long-standing system of brother-to-brother succession, carried on since Saudi Arabia’s founding, had been abolished, and father-to-son succession had begun.
Officially, the king remained the supreme authority. But the current king was elderly and, because of his health, had effectively stepped back from politics.
So it was no exaggeration to say that Rashid, as crown prince, now held all the power in Saudi Arabia.
Crown Prince Rashid declared a national development project, saying he would transform Saudi Arabia into a new country free from its old dependence on resources.
He also announced that women would be allowed to drive, take part in sports, and vote as part of efforts to expand their participation in the economy.
Women welcomed these radical, almost outrageous reforms, but the legal scholars and conservatives went into an uproar.
“Women driving? Women are meant to bear children, so they’re not suited to driving!”
“You’re saying women will be able to watch sports and go to the movies together?”
“A woman, doing that?”
“Next they’ll say men and women can work together in the same office!”
“This is against the will of God!”
“That brat knows nothing and is trying to ruin the country!”
“Oh, Lord!”
Some of the more extreme voices even spoke openly about staging a coup to drive Crown Prince Rashid out.
Rashid had also displaced the previous crown prince and taken the seat for himself, so there was no guarantee that other royals weren’t nursing similar ambitions.
In response, Crown Prince Rashid convened a meeting to discuss national reform and summoned politicians, officials, and business leaders to the Riyadh Ritz-Carlton.
Everyone gathered, but the meeting never began.
“When exactly is this meeting supposed to start?”
“I’m busy as hell—what is this even about?”
“What business does he have dragging me all the way here?”
As the waiting crowd grew restless and began to rise, royal guards appeared from nowhere, locked the doors, and surrounded them.
“What the hell is this?”
“Do you know who I am?”
“Where is the crown prince?”
“Hold on. Why are you taking our phones?”
Amid the rising commotion, Asher, one of Crown Prince Rashid’s closest men, stepped forward.
After Rashid became crown prince, he had immediately been appointed chairman of the Financial Investigation Committee, GAFI.
One of the royals shouted at him.
“What the hell do you think you’re doing? Do you even know who I am?”
Asher bowed his head to him.
“Prince Yusef, I presume.”
Yusef was the first son born to King Abu Barak’s first wife. That made him different from the other royals with nothing but titles; he sat in key state posts and wielded enormous power.
“Arrest him.”
At once, the guards stepped in and seized him from both sides.
Prince Yusef was stunned.
“How dare you! What is the meaning of this? Let go of my hands this instant!”
Asher said in a cold voice, “Your Highness, you said, and I quote, ‘By order of succession, my elder brother should be crown prince. I’ll drive Rashid out soon enough and take the position for myself.’ As you know, that constitutes the grave crime of plotting treason.”
“N-no...”
Of course he had said it.
Not privately, either, but out loud, many times. He had never once imagined that it could be treated as a crime.
At Asher’s gesture, the guards dragged him out of his seat.
“W-wait! Let go of me! I’ll speak to my father!”
When they saw Prince Yusef being hauled away, the other royals all fell silent at once.
Only then did they truly feel the weight of Crown Prince Rashid’s power.
Asher swept his gaze across the assembled crowd and said, “You all have one thing in common. You’ve spent years accumulating enormous fortunes through corruption.”
“W-what?”
“What are you talking about?”
“You’re saying we, the royal family, are criminals?”
Protests erupted from every direction, but Asher ignored them and continued.
“You now have a choice between two options. First, you can swear loyalty to the crown prince and donate the wealth you’ve amassed illegally to the state. Those who pay a sufficient patriotic contribution will be pardoned for past crimes and allowed to return home safely. Second, you can stay here and be interrogated until you pay an adequate patriotic contribution. Which will it be?”