The Conglomerate Family Became A Villain [EN]: Chapter 179

179. Summer on Wall Street (1)

Kani Paul, after receiving a report from Caron Victor, shouted, her voice sharp with anger.

“Giving up now! Do you have any idea how much we stand to lose?”

The thought of buying back all the shorted stocks sent a shiver down her spine.

The projected loss was staggering, ranging from at least $50 million to a potentially devastating $200 million.

“But if we continue down this path, the losses could be even greater,” Victor countered, his voice laced with caution.

“Push it down! Keep pushing it down!” Paul shrieked, refusing to concede.

Caron Victor lowered his head, absorbing the verbal assault. “Y-yes, I understand.”

As he disconnected the call, the lead manager approached him, concern etched on his face. “Mr. Victor, what are our orders?”

“Halt the short selling,” Victor stated firmly.

“Then, from this point forward…”

“Yes, initiate the buyback.”

Caron Victor was unwilling to prolong a losing battle.

‘Terra is already pulling out,’ he thought, a sense of resignation washing over him.

After 11:30 AM, the short-selling pressure, presumably from Terra, ceased, and Victoria Corporation’s stock price surged to $11.3.

It was foolhardy for Bank of America to continue shorting the stock alone.

‘Terra versus JP Morgan and Citibank? The outcome is already decided,’ Victor mused.

Regardless of Terra’s power, it couldn’t directly challenge two of the Big Three banks.

‘Besides, Victoria Corporation doesn’t have a large float [number of shares available for trading] in the market,’ he reminded himself.

This meant the number of shares available for shorting was limited.

“We will begin the buyback,” Victor announced.

“Understood,” the lead manager replied.

After receiving confirmation, the manager commenced the buyback operation.

As Bank of America started purchasing stocks to cover their short positions, Victoria Corporation’s stock price rapidly ascended to $11.4.

Ring. Ring.

The phone’s shrill ring cut through the tense atmosphere.

Caron Victor reached out and answered the call. “This is Caron.”

“Caron! What do you think you’re doing!” Kani Paul’s voice boomed through the receiver.

“We’ve stopped short selling,” he replied calmly.

“Defying my orders! Do you think you’ll get away with this?”

Caron Victor responded in a low, measured tone. “Ms. Paul, it’s over.”

“What?”

“Citibank has entered the fray. How can we possibly win? On Wall Street, money is power. And the short selling we’ve been doing recently could attract scrutiny from financial authorities.”

Kani Paul was aware of all this, but she refused to accept it. She couldn’t stop now. Stopping meant the end of her career.

“Why are they helping that small company!” she exclaimed, unable to comprehend why Citibank would intervene, even if JP Morgan had.

Caron Victor responded to her outburst, “Citibank hasn’t been offering City Services [municipal financial services] for very long. They wouldn’t want the company providing those services to become unstable, would they?”

“Just for that reason?”

Caron Victor sighed wearily. “Haa… Kani, isn’t it a better reason than why we shorted the stock in the first place?”

Their initial motive was to oust the Giannini family and inflict significant losses on Bank of America.

This was an act bordering on a breach of trust.

“Are you trying to betray me?”

“It’s not betrayal, but I’m planning to resign.”

Caron Victor realized that the situation had deteriorated to the point where he had no choice but to leave the company.

‘Instead of driving out the Giannini family, it’s ending this easily,’ he lamented.

His mouth felt parched.

“Resigning? Are you running away?”

“What other choice do I have?”

If there was another viable option, he would have taken it.

“Caron!”

“Kani, you should think about your own future. Terra is already pulling out.”

Terra’s retreat.

Kani Paul clenched her fist so tightly that her fingernails left imprints on her palm.

“N-no, this can’t be happening!”

She abruptly hung up the phone and immediately dialed another number.

Ring. Ring.

After several rings, the call was answered. “This is Terra.”

“Connect me to Ferman!”

“Mr. Ferman is currently unavailable,” the secretary replied.

Kani Paul’s eyebrows furrowed in anger at the response. “What?”

“He has left the company to attend a conference in Houston.”

Terra and Ferman had been actively shorting the stock until this morning.

“Don’t lie to me!”

The secretary responded coldly to her outburst. “This is the only answer I can provide.”

Clack.

Kani Paul slammed the phone down and covered her face with her hands.

“How could this happen?”

In just one day…

No, in just a few hours, her dream had crumbled.

* * *

13 hours prior.

New York, Wall Street.

A middle-aged man sported a thick hat, as if he had stepped out of a time machine from the 1930s.

“This is the place,” John Peer announced.

As John Peer raised his right hand, the man removed his hat.

Only after the hat was removed did Jung Hyun-woo understand the reason for it.

‘He’s wearing a hat because he’s balding badly,’ Hyun-woo observed.

The middle-aged man was completely bald near the crown of his head.

“John!”

Despite his baldness, his voice was energetic.

“How have you been?”

“Hahaha, I’ve been well.”

John Peer exchanged brief greetings before introducing him to Jung Hyun-woo.

“This is Michael Carter.”

Jung Hyun-woo recognized the name Michael Carter.

‘If it’s Michael Carter, isn’t he the CFO of Citibank?’ he thought, impressed.

The Chief Financial Officer of Citibank had traveled all the way here to meet him.

“I’m Charlie Jung,” Hyun-woo said, extending his hand.

Michael Carter shook Jung Hyun-woo’s hand and smiled warmly. “It’s an honor to meet a genius from MIT.”

“Genius is an overstatement,” Hyun-woo demurred.

Michael Carter sat across from Jung Hyun-woo. “I’ve heard the story roughly from John. You need cash?”

“I’m planning to fight Terra,” Hyun-woo confirmed.

Michael Carter nodded in response. “I understand. The collateral is Victoria Corporation’s stock?”

“That’s right.”

“How much money are you planning to use?”

Despite being the CFO, Michael Carter immediately inquired about the specifics, like a seasoned field operative.

“I need about $2 billion.”

“Then we’ll set the collateral at three times that amount,” Carter stated.

That meant approximately $6 billion worth of Victoria Corporation stock was required as collateral.

“You’re saying you want 30% of Victoria Corporation’s total shares,” Hyun-woo clarified.

Michael Carter acknowledged Jung Hyun-woo’s statement in a calm voice. “Since the stock price is fluctuating, shouldn’t we secure at least that much?”

“I understand. We’ll take 30% as collateral.”

“When do you need the money by?”

“The sooner, the better.”

Michael Carter jotted down the details of their discussion in his notebook and then summoned the waitress to order coffee.

“Well, now that the business talk is over, shall we discuss something else?”

Jung Hyun-woo’s eyes widened in surprise. “Does this mean the loan is approved?”

“Mr. Mount’s approval is still required, but it will be approved,” Carter assured him.

Michael Carter was confident about the loan’s approval.

Jung Hyun-woo and John Peer had been concerned that the deal might fall through, as it had with JP Morgan.

“Will the loan really be issued tomorrow?”

“Just submit the collateral on time,” Carter replied.

John Peer, still apprehensive, added, “Michael, you’re not going to tell us it’s not possible tomorrow morning, are you?”

Michael Carter clicked his tongue in response. “Tsk. Has this friend only experienced deception in his life? If you can’t trust my word, who can you trust…”

“It’s because we were rejected once before,” John explained.

Michael Carter had learned from John Peer that the loan from JP Morgan had been denied.

“We’re different from JP Morgan,” Carter stated.

“What does that mean?”

“It means there are no internal conflicts.”

Michael Carter believed that the reason the loan from JP Morgan had been rejected was due to Edmund Norman’s interference, not a lack of funds.

“Oh, right, I haven’t mentioned the interest rate yet,” Carter realized.

Jung Hyun-woo inquired, “How much interest do I have to pay?”

“10%,”

“Annual interest?”

“That’s right.”

The interest rate was relatively high, as JP Morgan had offered an 8% rate.

“That’s $20 million a month,” Hyun-woo calculated.

“We’re also taking risks, so it can’t be helped,” Carter justified.

Michael Carter was a man who ensured the terms of the deal were clearly defined.

“Michael, can’t you lower it a little? Isn’t Victoria Corporation a partner of Citibank?”

Michael Carter turned to John Peer and replied, “It’s because they’re a partner that the loan is even possible. And if we lower the interest rate further, the loan might not be approved.”

John Peer had no choice but to concede at the mention of loan approval. “Hmm, I see.”

Michael Carter shifted his gaze back to Jung Hyun-woo. “Do you have any intention of selling shares to us?”

“Are you suggesting Citibank wants to acquire shares in this company?”

“We also see a bright future for Victoria Corporation,” Carter affirmed.

Jung Hyun-woo sighed softly. “I don’t think that will be possible.”

“May I ask why?”

“Because I promised JP Morgan and Bank of America that there would be no additional share sales.”

Michael Carter listened to his explanation and promptly abandoned the idea of acquiring shares. “There was such an agreement. I understand. We’ll forgo the share acquisition.”

He didn’t pressure or attempt to entice the other party with empty promises.

As Jung Hyun-woo conversed with Michael Carter, he concluded that this man was a quintessential Wall Street financier.

‘He appears cold but isn’t, and he seems to give everything but still secures the gains,’ Hyun-woo thought.

If the battle between Terra and Victoria Corporation persisted for approximately 2-3 months, Citibank could potentially earn tens of millions of dollars from this conflict.

“Mr. Carter.”

“Do you have any questions for me?”

“Can I purchase Victoria Corporation shares using a Citibank account?”

Using Citibank Securities’ account to buy Victoria Corporation’s stock.

Michael Carter shrugged. “There’s no reason why not. We welcome it.”

“Thank you.”

John Peer frowned slightly and asked Jung Hyun-woo, “Mr. Jung, is there a specific reason why you want to use Citibank’s account?”

Jung Hyun-woo explained, “If we use Citibank Securities’ account, wouldn’t it appear as though Citibank Securities is making the purchase?”

John Peer exclaimed, “Ah, that’s right. And if rumors spread that Citibank has started buying…”

“Even Terra will be intimidated,” Hyun-woo finished.

Michael Carter listened to their conversation and smiled gently. “Mr. Jung, I hope the deal goes smoothly tomorrow.”

He believed Jung Hyun-woo’s strategy was sound.

‘It seems Terra has chosen the wrong opponent this time,’ Carter mused.

Short selling was a psychological game.

If you couldn’t frighten the opponent and intimidate the investors, you could never prevail.

But Jung Hyun-woo wasn’t intimidated; instead, his eyes gleamed with determination.

* * *

Victoria Corporation’s stock price closed at $11.1 on Monday, slightly lower than its midday peak.

“Hoo… I’ve breathed a sigh of relief,” the general manager said, wiping his brow.

John Peer nodded in agreement. “Good work.”

Despite successfully defending the market on Monday, he knew he couldn’t afford to relax.

‘I can’t assume that Terra has completely withdrawn,’ he thought.

John Peer, Jung Hyun-woo, and Michael Carter all suspected that Terra hadn’t completely retreated.

‘Since they’ve made a public declaration, it won’t end in just one day,’ Peer reasoned.

He picked up the phone and called Jung Hyun-woo.

“This is Charlie.”

“This is John Peer. We defended the market at $11.1 today.”

“Good work.”

“What should we do tomorrow?”

Jung Hyun-woo responded calmly, “Let’s proceed as we did today.”

“You mean we should maintain the pressure?”

“We shouldn’t give the short sellers any breathing room,” Hyun-woo affirmed.

John Peer nodded in agreement. “I understand. Then I’ll start buying from the market’s opening.”

As articles were published stating that the hacking issue had been resolved and that negotiations with the AS engineers were progressing well, investor sentiment toward Victoria Corporation began to recover slightly.

4 p.m.

Another piece of positive news for Victoria Corporation emerged.

It was announced that sales of the NES [Nintendo Entertainment System] released by Nintendo had exceeded market expectations. Furthermore, Victoria Corporation had recorded the highest sales among Nintendo’s third-party developers.

Peter Lynch discussed this with John Peer over the phone.

“The actual cartridge sales aren’t even 100,000, but we need good news right now,” Lynch said.

“Is the news more important than the sales figures?” Peer asked.

“Don’t you know that already?” Lynch retorted.

John Peer nodded in agreement. “That’s right.”

Since the news was released after market hours, it hadn’t yet impacted the stock price, but it was certainly news that would stimulate investment sentiment.

John Peer asked Peter Lynch, “How much more are you planning to buy?”

Peter Lynch paused for a moment before replying, “I can allocate about $20 million more.”

“You’re overdoing it,” Peer cautioned.

John Peer believed that, considering the size and nature of the Magellan Fund, Lynch shouldn’t invest too heavily in Victoria Corporation.

“Isn’t JP Morgan investing more?” Lynch countered.

“We have shares in Victoria Corporation, so…” Peer trailed off.

JP Morgan’s shareholding in Victoria Corporation had increased slightly due to the short-selling incident.

“By the way, who did you call yesterday?” Lynch asked.

Peter Lynch had left before Michael Carter arrived, so they hadn’t met.

“Michael,” Peer answered.

Peter Lynch paused at John Peer’s response. “Michael Carter? You called that guy?”

“There’s no one more capable than him at Citibank,” Peer asserted.

“A big shot appearing in an unnamed cafe,” Lynch chuckled.

“What about Peter Lynch of the Magellan Fund?” Peer countered.

Peter Lynch had been steadily building his reputation over the past few years.

“John.”

“Why?”

“Work hard,” Lynch encouraged.

John Peer replied nonchalantly, “I’m working hard enough.”

As of July 1985, he had been promoted to head of JP Morgan’s fund business division.

It could be argued that John Peer had achieved considerable success on Wall Street.

At the same time.

Jung Hyun-woo also received a report on the Nintendo-related news.

“Hoo… With this much news, I can breathe a sigh of relief,” he said.

Standing beside him were his secretary, Luna, and Mac Coyle, head of the AS Business Division.

“Today’s negotiations were also productive,” Coyle reported.

Jung Hyun-woo lowered his voice and said, “It would be problematic if they weren’t.”

He was well aware that this entire situation had originated with the AS engineers’ strike threat.

“We are currently finalizing the equity and wage increase rate,” Coyle continued.

“It’s acceptable to exceed the upper limit slightly,” Hyun-woo instructed.

Mac Coyle paused and asked, “Mr. CEO, is it really okay to exceed the upper limit?”

Jung Hyun-woo had previously provided him with a maximum limit for the negotiations.

“We are fighting Terra, so we have no choice but to make some concessions,” Hyun-woo explained.

Mac Coyle smiled, as if a weight had been lifted from his shoulders. “I understand. I will conclude the negotiations within 2-3 days.”

The sooner the negotiations were completed, the better.

After Coyle departed, Luna said to Jung Hyun-woo, “I received a phone call a little while ago.”

“Who was it from?”

“It was a call from a Mr. Neil Hamilton.”

Jung Hyun-woo’s eyes widened at the mention of Neil Hamilton’s name.

“Mr. Hamilton called?”

Neil Hamilton was Henri Arnault’s predecessor and a formidable rival of Edmund Norman, the current CEO of JP Morgan.

“He asked me to tell you, ‘Congratulations on your victory.'”

Victory.

Neil Hamilton had concluded that this battle had ended in Jung Hyun-woo’s favor.