Dongwoo Precision (3)
At DA Securities, a sweeping personnel shake-up had erupted out of nowhere.
Executive Director Yang Jeong-uk had stepped down from his post, and the executives who had risen on his line were being cycled out one after another. It had caused no small amount of confusion along the way, but thankfully things were slowly settling back into place.
Sung Yoon-ah could feel the atmosphere around her change.
The mother who had suddenly become the family’s heir apparent was now so overwhelmed with work that she was barely ever home. Her own standing had changed as well, and marriage proposals had begun arriving from all directions.
At this rate, it would be impossible to keep hiding who she was much longer.
For a while, she had wanted nothing more than to keep going to work like anyone else and live an ordinary life, but that wish shattered almost immediately.
During the personnel reshuffle, one of the executives let slip her identity, and in an instant the rumor had spread through the entire company.
Once it became known that the new hire was the chairman’s granddaughter and the only daughter of the next chairwoman, the company had practically turned upside down.
The supervisor who had been shouting at her just yesterday to do her work properly had turned into a meek lamb, while the deputy manager who had kept making advances for no reason at all—sliding up beside her, resting a hand on her shoulder, texting pointless check-ins even on weekends—now broke into a cold sweat and looked away the moment their eyes met.
When lunchtime came, Sung Yoon-ah came out through the back entrance.
Employees gathered in little clusters, chatting cheerfully among themselves, but the moment they noticed her, they stiffened and avoided her gaze.
This kind of thing will probably become normal with time.
She headed toward Hwang Yeong-min and Bae Geun-seok, who were standing in the smoking area.
Bae Geun-seok looked startled and hurriedly hid his cigarette behind his back before bowing his head.
“Oh, y-you’re here?”
Sung Yoon-ah stared at him, dumbfounded.
“What do you mean, ‘you’re here’?”
Bae Geun-seok scratched his head.
“Ah—sorry. I said it without thinking.”
“We’re coworkers. Why are you acting like that?”
At her words, Hwang Yeong-min, who was smoking beside him, said with great confidence, “That’s right. What does it matter who your parents are, Yoon-ah? To us, you’re just a classmate from the same hiring group. I honestly don’t get why everyone’s making such a big deal out of it.”
“Then why did you put your cigarette out?”
“Well… secondhand smoke isn’t good for your health, right?”
Sung Yoon-ah let out a quiet sigh to herself.
It really was impossible to ask them to treat her exactly the same as before.
“Let’s go get lunch.”
The menu was army stew.
Coming here, she found herself thinking of one person.
Before she knew it, she murmured, “I wonder what he’s doing right now.”
Even though she hadn’t said his name, the two of them knew immediately who she meant.
“You mean Miru?”
“He does seem like the type who’s doing well for himself somehow.”
Hwang Yeong-min tilted his head. “But was Miru always that kind of guy?”
“What do you mean?”
“I mean, until recently, he seemed really quiet.”
Bae Geun-seok nodded in agreement. “And he didn’t stand out much either.”
“Exactly. But in just the last month or two, it feels like he’s become a completely different person.”
“Oh! I thought so too.”
“Maybe he always had that kind of personality and just kept it bottled up.”
Sung Yoon-ah’s impression of Han Miru was much the same.
He had been the sort of person who blended into any crowd, the kind you could pass by anywhere without noticing.
And yet that was the same person who had turned the company upside down before walking out.
He had uncovered the rot in the Primus Fund and exposed it for what it was. But for all that, he hadn’t gained a single thing from it—he had only lost his job.
And even so, why had he clung to it so desperately? The whole thing felt like it had been driven by some kind of mission.
The more she thought about it, the more mysterious it became.
She was spaced out, lost in thought, when Hwang Yeong-min said, “Your phone’s ringing.”
“It’s fine. I can answer it later.”
Bae Geun-seok added, “I think it might be Miru calling.”
“What?”
At that, Sung Yoon-ah set down her chopsticks at once and hurriedly grabbed her phone.
“Hello?”
[Hello. This is Han Miru. It’s lunchtime, right? Do you have a minute to talk?]
She cleared her throat and replied, “Yes, Miru. What is it?”
[I have something to talk to you about. Could we meet?]
Something to talk about? To me?
Alarmed, Sung Yoon-ah asked, “Uh, when do you want to meet?”
[The sooner, the better.]
“Then… let’s meet after work.”
[Sure. Tell me the time and place, and I’ll come.]
“Okay.”
After the call ended, Sung Yoon-ah lowered her phone.
Across from her, Hwang Yeong-min and Bae Geun-seok asked as if they’d been waiting for it, “Why did Miru call?”
“What did he say that got you so flustered?”
At that, Sung Yoon-ah really did get flustered.
“W-when was I flustered?”
“You look pretty flustered right now.”
“Just eat your lunch already.”
Sung Yoon-ah barely tasted the army stew as she ate, all the while thinking to herself, What should I wear? Do I even have anything at home that’s decent enough to wear out?
After making the appointment, I ended the call.
No matter how you looked at it, there was no way I could meet a woman looking like some pitiful bum. It had been a while, so I shaved off my beard and put on proper clothes.
When Seonwu saw me like that, he asked, “Who are you meeting? A girlfriend?”
“Since when do I have a girlfriend?”
“Then who are you meeting?”
“A former coworker.”
I met Sung Yoon-ah at a café in Hannam-dong.
She was wearing a white sweater and an H-line long skirt, with a cashmere coat draped over it. I’d only ever seen her in a suit before, so seeing her dressed casually felt strangely fresh.
No, fresh wasn’t enough to describe it. She was beautiful. So this was what she looked like outside the office.
Sung Yoon-ah asked me, “How have you been?”
“Busy, for the most part.”
If she knew what had happened in the meantime, she’d probably be shocked.
We drank coffee and talked. She seemed genuinely glad to see me, like she was meeting an old friend, and chatted about one thing after another.
Thinking about it, it really was strange.
During my first life, we had been nothing more than people who passed each other by now and then and exchanged the occasional greeting. But now we were sitting outside together, drinking coffee.
It felt almost like we’d known each other for years.
So much had changed from before.
“So what did you want to see me about?”
I asked carefully, “The truth is, I’ve got something to talk to you about, Yoon-ah.”
“S-something to talk about?”
“Yes. I thought about whether I should bring this up at all, but in the end, you were the only person I could think of.”
“R-really?”
For some reason, she looked incredibly tense.
I could guess exactly what was going through her mind. What could a former coworker who had suddenly asked to meet possibly have to say?
“Relax. I’m not here to ask you for money.”
At that, Sung Yoon-ah let out a small snort of laughter.
“Then what is it?”
“Don’t misunderstand me for saying this.”
“Okay. I won’t misunderstand. Go on.”
I made up my mind and spoke.
“I want to buy Dongwoo Precision bonds. Could you look into it for me?”
As expected, it was so far from what she’d anticipated that her expression froze solid.
After staring blankly for a moment, Sung Yoon-ah groaned, “...What?”
She looked genuinely shaken.
To be fair, anyone would be thrown off by a request like that.
Unlike stocks, bonds aren’t something the average person can easily access. Even bonds issued by the same company can differ wildly depending on when they were issued—interest rates, maturity dates, terms, all of it—so bond brokers specialize in handling those transactions.
And if you wanted to buy a large amount of junk bonds, you had no choice but to rely on institutional muscle.
Sung Yoon-ah let out a quiet breath before asking me, “Why Dongwoo Precision bonds all of a sudden?”
I gave her a convenient answer.
“I’ve got a rich friend, and I’m helping him with some investing.”
“Wealth management?”
“Something like that, yeah.”
Sung Yoon-ah asked, “How rich are we talking?”
“You’d be surprised if I told you.”
“I won’t be surprised.”
I said cautiously, “He’s got about 13 billion won in cash.”
She nodded. “I see.”
She looked like she really wasn’t surprised at all.
From my perspective, that was an absurd amount of money, but maybe to her, if it was a rich friend, that kind of cash was normal.
“But isn’t Dongwoo Precision suspended from trading right now? It’ll probably go bankrupt soon.”
“Oh! So you know about it.”
“After the Primus incident, the Financial Supervisory Service formed a special inspection team and started investigating. Because of that, fund managers are dumping bad debt all at once. Dongwoo Precision bonds are included in that, too. The company’s credit rating must have dropped to CCC- by now.”
Usually, BBB- was the lowest investment-grade rating; anything below that was junk. CCC- was practically the bottom of the barrel.
As expected, being part of the audit team meant she knew her stuff.
“How much are you planning to buy?”
“All 13 billion won of it.”
Sung Yoon-ah’s eyes widened.
“At issuance price, that would be well over 100 billion won.”
It was too early to be shocked.
“I’m thinking of focusing on the subordinated BWs issued last year and the year before.”
This time, her mouth fell open.
“Are you serious?”
The reason she was so shocked was simple.
A joint-stock company has limited liability.
What that means is that even if a company can’t pay its debts and goes under, shareholders aren’t on the hook for the losses.
If there are any assets left after the company collapses, then who gets them?
The creditors, not the shareholders, split them up. And even among creditors, the order of repayment differs depending on the type of debt.
Subordinated debt is exactly what it sounds like: subordinated.
Only if there’s anything left after the senior creditors have collected every last bit of principal and interest do the subordinated creditors get a share.
But what kind of company leaves enough behind after bankruptcy for that to matter?
In the end, if you hold subordinated debt, you can assume you’ll recover nothing if the company fails. Among junk bonds, it was about as bad as it got.
That said, the greater the risk, the greater the return. Compared with senior debt, the interest rate would be one or two percent higher, or come with additional conditions.
“Can I ask why Dongwoo Precision bonds specifically?”
No one bought the debt of a company they thought was about to die unless they were an idiot.
The reason I was buying these bonds was obvious.
“Dongwoo Precision is going to recover.”
Sung Yoon-ah was startled all over again.
“Is that really true?”
“I’ll tell you the details later. Can you do it?”
After looking at my face for a moment, Sung Yoon-ah nodded.
“Okay. I’ll look into it right away.”
I smiled.
“Thanks.”
Dongwoo Precision was a mid-sized company with more than thirty years of history.
It had entered the semiconductor market in the late 1990s and made a name for itself as a strong, specialized firm, helping localize semiconductor parts through solid technical expertise.
Along with investing in new product R&D, Dongwoo Precision financed itself mainly through debt while building new factories.
Last year and the year before, the semiconductor market had been so hot that people were talking about a supercycle, and the 300 billion won in subordinated BWs issued during that period had been sold out without difficulty.
Now, that same debt was being tossed around as everyone scrambled to dump it.
BW, or a bond with warrants, is a type of corporate bond.
Compared with ordinary bonds, it pays a lower interest rate, but at maturity it gives the holder the right to buy new shares at a predetermined price.
If the stock price at maturity is above the exercise price, you can take the new shares, sell them, and pocket the difference. If it’s below the exercise price, you simply don’t exercise the right.
Dongwoo Precision’s BW had a five-year maturity and an annual interest rate of 7.6 percent.
It wasn’t compounded; interest was paid every three months.
Good yield, plus a warrant attached.
Given the current interest-rate environment, a bond like that should have been trading above par. Instead, the actual market price was only 10 to 15 percent of face value.
As for the warrant, the subscription price was 12,000 won, while the stock was currently stuck in trading suspension at 6,580 won. In practical terms, the right was worthless.
Since they weren’t going to recover a single won if the company went under anyway, they were trying to dump it for whatever cash they could get right now.