GL Entech (6)
After the emergency economic countermeasures meeting, articles came flooding in.
When Senior Dongho saw them, he was shocked.
"What is this? If they lift the lockup period, what happens then?"
If they really did lift the lockup, sell orders would pour out and the stock would collapse.
"They won't be able to."
"Then what is this article about?"
"They're trying to calm the buy side by signaling that the government can intervene at any time."
Since direct action was difficult, this was the desperate fallback: a threat in words.
If Continue Capital got scared and dumped its shares, even better. Naturally, there was no reason for us to fall for a stunt like that.
Still, it seemed to have an effect, because when the market opened, GL Entech fell by about 20 percent.
"What if they really do lift it?"
"I told you, they absolutely can't."
"Why not?"
"Think about it. President Oh Young-hwan is already under suspicion of taking bribes from the GL Group. If he breaks principle for the sake of a chaebol in a situation like this, what do you think happens?"
"Ah! So that was why you slandered our innocent president!"
“……”
Had he really voted for Oh Young-hwan?
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(Strategy)
The lockup period on a major shareholder's shares serves as a safeguard at the time of listing. Without it, once a company goes public, the controlling shareholder could sell off every last share without restriction.
In that case, investors who took part in the offering would suffer enormous losses, which would also be expected to damage companies preparing for their own listings.
When asked for his view, Representative Lockhart said this:
"If they lift the lockup, confidence in the Korean stock market will fall sharply. Korea is a developed country. I don't think there will ever be a case where the government changes the rules for a specific chaebol group. On the contrary, this rumor dropping GL Entech's stock is a very good opportunity. I'll be buying more this time."
It wasn't just talk. Not long after the article went out, a disclosure hit the market.
"If they can just lift the lockup however they want, what are investors supposed to trust?"
"If a major shareholder can sell their stock however they please after listing, who would ever participate in an IPO?"
"They'd kill every small and mid-sized company just to save one big conglomerate!"
As the confusion grew, Gong Chi-hyeon, head of the Korea Securities Depository, stepped in to clarify.
"Lifting the lockup is impossible under current law, and it is not something that has even been discussed. We ask the press to refrain from speculation."
That announcement pushed GL Entech up another 10 percent, sending it past 550,000 won.
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The one in an awkward position was not only the president.
Im Chang-sik, leader of the Woori Kookmin Party, was in the same boat.
Until just before this happened, he had been praising himself for solving the issue wisely through corporate self-regulation.
But this happened before the self-regulation could even be properly put into practice.
As the situation spiraled out of control, the Saehan Party turned its fire on Im Chang-sik.
"If this had been regulated through legislation, this would never have happened. This is a matter that should be taken up by Representative Namgoong Seok's bill, not by the self-regulation approach pushed by Representative Im Chang-sik. Representative Im must immediately scrap this useless self-regulation proposal and apologize to the public and investors."
There was also an intention here to spread the blame around and reduce the criticism aimed at the president.
In any case, if they had simply passed the regulatory bill Namgoong Seok had drafted, this would never have happened.
But not only had they thrown that bill aside, they had even referred Namgoong Seok to the party disciplinary committee.
The Saehan Party hammered that point relentlessly, and the effect was clear: public criticism began to pour down on Im Chang-sik.
Until then, Representative Im Chang-sik had been seen as calm and cautious. But that image had now changed into one of weakness and indecision.
Im Chang-sik was furious.
"No, everyone said self-regulation was a good idea! Why are you doing this now?"
When they had chosen self-regulation, Saehan Party had clearly and tacitly agreed as well. Yet now they were suddenly acting as though it was all his fault.
Senior Supreme Council Member Park Seong-ju said, "The situation is not good. It looks like we may need to abandon self-regulation and pursue legislation instead."
"You want us to put Representative Namgoong Seok's bill on the table?"
"Yes. If we don't, the Saehan Party will introduce it first. We need to move quickly."
"......"
The one who had tossed that bill aside was none other than him. He had also been the one to refer Namgoong Seok to the disciplinary committee.
And now you're telling me I have to support that bill?
Im Chang-sik made his position known to the press.
"Self-regulation was only one possible option. This incident has confirmed that self-regulation is insufficient, so the National Assembly will step in and move quickly to legislate the relevant laws."
Then Saehan Party changed its tune again, attacking him for shifting positions.
"Not long ago, Representative Im Chang-sik said he opposed legal regulation and referred Representative Namgoong Seok, who advocated it, to the party disciplinary committee for acting against the party's interests. This is effectively an admission that Woori Kookmin Party is not a public party, but nothing more than Representative Im Chang-sik's private faction. Representative Im Chang-sik, who deceived companies and deceived the public, should take responsibility and resign from the National Assembly immediately."
While President Oh Young-hwan and Representative Im Chang-sik were cornered politically, Namgoong Seok's recognition rose sharply, and by now there was no one who did not know his name.
The things he had done before suddenly became talking points.
-Namgoong Seok was the only one who protested together with GL Chemical shareholders to stop GL Entech's listing!
-While the Blue House and the National Assembly were both sitting on their hands, Namgoong Seok was the only one who stepped up and said regulation was needed!
-He was originally a professor, but he ran in an election to get dormitories built for students and ended up becoming a lawmaker!
-After seeing this, I withdrew my support for Im Chang-sik and decided to back Namgoong Seok instead.
-Just pass the regulatory bill Namgoong Seok submitted already~
-Anyone who opposes it, I won't leave alone!
-Let's show the power of the 10 million retail investors!
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What Namgoong Seok had felt when he first became a lawmaker after being a professor was the sheer force of power.
There were only 300 members of the National Assembly.
In a sense, one lawmaker represented about 170,000 citizens.
The dormitory issue, which had gone nowhere no matter how much he had pushed as a professor, was resolved in an instant. Feeling his own power, he thought he could accomplish many things with it.
But once he began walking the true path of a politician, he once again realized how helpless a lawmaker really was.
What is this, some kind of Dunning-Kruger effect?
On his own, a lawmaker could not even get a bill introduced, let alone passed.
No matter how good the law was, opinions split depending on interests, and party lines meant people either opposed it blindly or supported it blindly.
This time was no different.
As could be seen from the GL Entech listing problem Han Miru had mentioned, the Korean stock market was little more than a den of vipers.
Abuse of power by conglomerates and embezzlement and breach of trust by major shareholders were no longer even news.
Chaebol groups poured work orders into companies founded by their own children, and once those businesses had grown enough to matter, they would spin them off and list them.
Right after listing, executives sold stock options to pocket the profits, stuffing their own accounts full.
It was nothing short of a criminal act of theft against minority shareholders. Yet astonishingly, in Korea, all of this was perfectly legal.
The press did not raise an issue with it, and neither did the political world.
So Namgoong Seok had shouldered the burden and stepped forward.
The only thing that could stop the tyranny of the chaebol groups was politics.
He shouted that subsidiaries spun off through physical division should not be allowed to list, and that if that was too difficult, at the very least existing shareholders had to be compensated.
The result was failure.
Saehan Party walked away entirely, and Woori Kookmin Party chose self-regulation, which was practically useless.
And GL Entech went public.
Continue Capital took away about 1 trillion won, the GL Group's ruling family secured a massive pile of investment capital, and the securities firm that underwrote the listing, along with the institutions that subscribed, all made money.
The only people who suffered were the minority shareholders of GL Chemical.
It was a bizarre situation in which the people who had contributed most to the company's growth suffered the greatest losses.
Whose fault was that, really?
Was it Continue Capital, which had shorted the stock? Was it the GL Group, which had pushed ahead with the listing?
Or was it...?
Was it the politicians who failed to make the law properly?
He gave a bitter smile without meaning to.
Even after GL Entech was listed, he continued pushing for legislation, feeling like a farmer who had lost a cow and was only then mending the barn.
That way, at least, he wouldn't lose the next cow.
But the party had already decided to accept the self-regulation plan created by the chaebol groups. The bill he had written was discarded without ever reaching the plenary session.
And then he received notice that the disciplinary committee would be held and that he should submit a statement of explanation.
It wasn't the first or second time something like this had happened, but for some reason, it still left him feeling completely drained.
He knew that the self-regulation plan would never work properly.
Representative Im Chang-sik might think self-regulation was a path that could satisfy everyone, but there is no solution in a conflict of interests that satisfies everyone.
It might look fine right now, but there would definitely be trouble a few years down the line.
By then, no one would even remember who was responsible, so maybe it won't matter?
But his prediction was wrong.
It wasn't even a few years. The problem blew up in barely a month.
GL Entech stock was rocketing upward like mad, and the entire KOSPI was shaking.
Namgoong Seok was stunned by the articles pouring in.
"W-what is this?"
It felt like he'd been hit in the head with a hammer.
It had been bothering him all this time.
Why did Han Miru tell me about this?
Now he thought he understood why.
If he had not stepped forward to stop the listing after the physical split, the GL Group would have delayed GL Entech's IPO.
If he had not demanded a stock dividend in kind, GL Chemical and the institutions would not have placed the lockup.
All of this had happened because of him.
No, wait... was he approaching me from the very beginning for this exact purpose?
In a way, he had been moving entirely for the benefit of Continue Capital all along!
With trembling hands, Namgoong Seok called Han Miru.
After only a few rings, the call connected.
"Hello, Representative. I hope you've been well."
Namgoong Seok skipped the greeting and asked, "What the hell do you think you're doing?"
[Pardon? What do you mean, what am I doing? I'm not sure I follow... ]
He nearly shouted, "GL Entech, that's what!"
[Ah, that. As you can see, it's exactly what it looks like.]
Han Miru's voice was calm, as if nothing at all were wrong.
"Were you deceiving me?"
[Deceiving you? Why would you think that? Was there anything I told you that wasn't true?]
It wasn't exactly wrong.
Han Miru had indeed told the truth. He had simply not told the whole truth.
[What is happening right now is something that would not have happened if you had only blocked the GL Entech listing.]
"W-what did you say?"
Han Miru said, sounding almost regretful, [So you should have blocked the GL Entech listing. Then none of this would have happened. Isn't that right?]
“……”
For a moment, he was completely speechless.
[Since it seems you have nothing more to say, I'm busy, so I'll hang up now.]
"Wait! Hey! Don't hang up, you bastard!"
Before he could say another word, the call ended.
Enraged, Namgoong Seok threw down his phone and shouted, "Damn it!"
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