The Conglomerate Family Became A Villain [EN]: Chapter 284

284. Endgame (2)

While Victoria Fund and Jung Hyun-woo focused on Japan, Robert and the developers unveiled a new version of JP Service.

This time, Robert himself, not Sarah, went on stage to explain the various functions of JP Service.

“The most important feature is the watchlist.”

Watchlist.

To people in the 21st century, this was nothing special. If you reframed it as something like a ‘shopping cart,’ ‘basket,’ or ‘wish list,’ you’d easily find it on any internet site.

But in 1989, it was a different story.

“You can specify up to five companies that you own or are interested in, and these designated watchlists are always fixed on the right side of the computer screen. This allows you to accurately check stock price fluctuations even when you are searching for other stocks.”

Reporters applauded the new feature developed by Victoria Corporation.

“Amazing!”

“It’s Victoria Corporation after all.”

“Victoria Corporation’s innovation never stops.”

Robert smiled and responded to the reporters’ cheers.

“Thank you. Thank you. Victoria Corporation is doing its best for your victory as investors.”

After that, Robert explained various convenience functions and the changed search service.

The functions he explained were functions that any site provided in the 21st century, but as explained earlier, they were nothing short of a revolution in 1989.

When Victoria Corporation’s new JP Service presentation ended, Henri Arnault let out a short sigh.

“Hoo… I’m glad that JP Service came out well.”

Greinke, head of JP Morgan Asia Fund, approached and reported to him.

“Mr. Arnault, Victoria Corporation has fallen to 5th place.”

Henri Arnault narrowed his brow.

“Are you saying the market reacted negatively to this announcement?”

Greinke hesitated and shook his head.

“That’s not it.”

“Then?”

“Sumitomo Bank’s stock price rose 13% today, and Sumitomo Bank’s market capitalization has surpassed Victoria Corporation.”

It was Sumitomo Bank alone, not the Sumitomo Group, that surpassed Victoria Corporation’s market capitalization.

After receiving Greinke’s report, Henri Arnault let out a long sigh.

“Hoo… Has the number one company in the United States been caught up by the fourth in Japan?”

Big 5.

The top five companies in the world in terms of market capitalization.

Among them, the only non-Japanese company was Victoria Corporation, which was at the very end, in 5th place.

“It seems a bit excessive.”

Henri Arnault narrowed his brow and nodded.

“Charlie’s idea might be right.”

The products produced by Japanese companies were clearly competitive. But it didn’t make sense to absorb all the money in the world just for that reason.

‘It’s a bubble. A very big one.’

Starting in the summer of 1989, the Japanese bubble theory began to resurface little by little.

But the Japanese Nikkei index was heading upwards without hesitation.

“What are you going to do?”

Henri Arnault hesitated for a moment before answering.

“I think I need to meet Edmund.”

He wanted to meet Edmund Norman, the chairman of JP Morgan.

* * *

“Edmund, the current situation is not easy.”

Edmund Norman didn’t show much reaction even after listening to Henri Arnault’s explanation.

“Isn’t the bubble in the Japanese economy something everyone knows?”

“I’m not talking about a simple bubble.”

“Henri, you are swayed by Charlie Jung every time.”

“Mr. Norman.”

Edmund Norman stared at Henri Arnault with pale eyes.

“The world’s attention is on China, not Japan.”

“Are you talking about the Tiananmen Square incident?”

Early summer of 1989.

The Tiananmen Square incident occurred in Beijing. And Western countries were quickly criticizing China and announcing measures such as cutting off economic cooperation.

“Shouldn’t we withdraw from China first?”

Henri Arnault’s eyes widened.

“Are you saying we should withdraw from China?”

“Won’t the conflict between the United States and China worsen?”

“Th, that is…….”

JP Morgan was investing as much in China as it was in Japan.

“Is it impossible?”

Henri Arnault frowned and replied.

“All Western companies are hesitant to invest in China. If we try to withdraw from China now, we will have no choice but to sell our shares and bonds at a bargain price.”

Edmund Norman raised his voice as he stared at him.

“Don’t you have a friend you like? I think that friend would buy our bonds.”

Henri Arnault swallowed dryly as he listened to him.

“You’re talking about Charlie Jung.”

Jung Hyun-woo had invested in Japan, but he hadn’t shown much interest in China.

Instead, he was focusing on investing in American IT companies.

“Isn’t Victoria Fund diligently shorting the funds taken out of Japan?”

“But they won’t have much spare money because of the losses from short selling.”

In fact, Victoria Fund was losing money every time it shorted.

Edmund Norman raised his right index finger.

“I’ll set one condition.”

“A condition?”

“Set the condition that Victoria Fund stops recovering funds.”

After Arthur Morgan’s death.

JP Morgan was gradually recovering the funds invested in Victoria Fund.

Edmund Norman’s proposal was to stop the recovery of funds, so he wanted them to take over the Chinese investments that had become bad debts.

“Is that possible?”

Edmund Norman replied in a soft voice.

“Isn’t it up to you to make that possible?”

In short, it was a way of saying to earn his keep.

Henri Arnault thought his mouth tasted bitter.

‘In the end, it all falls on me.’

He rose to become the second-in-command of JP Morgan after Arthur Morgan’s death, but it didn’t feel very good.

“Even if I persuade Charlie Jung, isn’t there still the board of directors left?”

On the JP Morgan board of directors, there were members of the Morgan family who had inherited from Arthur Morgan.

“I’ll persuade that side.”

As the CEO of JP Morgan, he was saying that he would persuade the major shareholders.

“Okay. Then I’ll take care of Charlie Jung…….”

“I’ll take care of the board of directors.”

Edmund Norman and Henri Arnault.

Rather than competing, the two often compromised on each other’s interests.

* * *

Boston.

Jung Hyun-woo’s house.

Jung Hyun-woo tilted his head as he saw the guest who had come to visit him.

“You really came.”

Henri Arnault was wearing an Italian suit that felt sharp.

“New York and Boston aren’t that far away.”

Jung Hyun-woo led him to the study.

“I could have gone to New York.”

He was scheduled to go on a business trip to New York next week. However, Henri Arnault wanted to meet as soon as possible and came directly to his mansion.

‘Tsk, seeing him come so suddenly, it doesn’t seem like good news.’

It was when he clicked his tongue inwardly.

Sarah came out of the kitchen and greeted Henri Arnault.

“Mr. Arnault, hello?”

Henri Arnault raised his eyebrows as he saw Sarah in casual clothes.

“Ms. Hilton, you really are living together.”

Jung Hyun-woo scratched his head and took his words.

“She was my sister.”

Just as Henri Arnault was about to tilt his head and ask, Sarah took the lead.

“Mr. Arnault. I’m preparing dinner, so please have some before you leave.”

Henri Arnault bowed slightly.

“I have a lot of work in New York, so I don’t think I can accept Madam’s invitation.”

“Ah, you’re the CEO of JP Morgan after all.”

“I’m the CEO of JP Morgan Investment Bank.”

Henri Arnault thought that Sarah had intentionally omitted the word investment bank.

‘It seems like she’s trying to gauge my mood as much as possible.’

He knew what Sarah and Jung Hyun-woo were worried about.

A complete withdrawal from Victoria Fund.

Or the sale of Victoria Corporation’s shares.

Even if only one of the two exploded, Sarah and Jung Hyun-woo would suffer considerable damage.

“Hahaha, that’s right. Then I’ll bring out the tea.”

Sarah disappeared back into the kitchen, and Jung Hyun-woo and Henri Arnault took their seats in the study.

“Henri, please speak comfortably.”

Henri Arnault took his words in a soft voice.

“Then I’ll really speak comfortably.”

Jung Hyun-woo didn’t like his smooth attitude.

‘It feels like there’s a knife hidden in his smile.’

Henri Arnault was a man who perfectly fit the saying “a wolf in sheep’s clothing.”

“Since you say so, I’m looking forward to it.”

After a short silence, Henri Arnault got straight to the point.

“JP Morgan wants to make a proposal to Victoria Fund.”

JP Morgan’s proposal.

Jung Hyun-woo thought there would be some kind of change.

‘They’ve been taking money out little by little since Arthur Morgan’s death.’

He was also assuming a complete withdrawal from JP Morgan.

“What kind of proposal is it?”

Henri Arnault lowered his voice and replied.

“We want to propose a new investment.”

A new investment.

It was an answer he had never thought of.

‘A new investment in times like these?’

South America or the Soviet Union, which has just begun to open up?

Neither was a very good investment destination.

‘South America is a dragon that can’t wake up, and the Soviet Union is about to collapse.’

He put a little strength in his throat.

“I would appreciate it if you could be more specific.”

Henri Arnault took a deep breath inside and then told the main point.

“Okay. The investment destination we want to propose is China.”

The next moment, Jung Hyun-woo’s eyebrows shot up.

“China?”

Henri Arnault clicked his tongue inwardly as he saw Jung Hyun-woo’s eyebrows rising.

‘Tsk, there aren’t many fools who would invest in China now.’

After the Tiananmen Square incident, investment in China had shrunk dramatically.

“Mr. Jung, China is reforming and opening up…….”

Before he could finish speaking, Jung Hyun-woo raised his voice.

“Mr. Arnault, world opinion is boiling over the Tiananmen Square incident.”

Jung Hyun-woo was raising his voice, but inside he was smiling with satisfaction.

‘Hoo, now is the time to invest in China, which is hitting rock bottom due to the Tiananmen Square incident.’

He expected that the more negative he looked towards China, the greater Henri Arnault’s concessions would be. And that expectation was right on target.

“Charlie, I admit that the current situation in China is not good. But in the long run, China is not a bad investment destination.”

Jung Hyun-woo took his words in a cold voice.

“Is there anyone who would invest in China when there is Japan?”

“Doesn’t Charlie want to leave Japan?”

“Henri, even if I left Japan, I didn’t go to China.”

A tense atmosphere lingered between Henri Arnault and Jung Hyun-woo.

“Okay. I’ll tell you the specific proposal from our side.”

Jung Hyun-woo’s voice was still cold.

“Are you making a specific proposal to someone who has no intention of investing?”

“Charlie, it won’t be too late to decide after listening to everything.”

Jung Hyun-woo crossed his arms with a displeased look.

“I’ll listen to the story for now.”

Henri Arnault coughed lightly and began to speak.

“Hmm, hmm. The JP Morgan board of directors is viewing two investments negatively.”

Jung Hyun-woo knew very well what those two were.

‘It must be the investment in China and the investment in our Victoria Fund.’

Both investments were in opposition to the current public opinion.

“The two investments that the board of directors objected to are Victoria Fund and China.”

It was as expected.

Jung Hyun-woo raised his voice slightly.

“Is JP Morgan withdrawing from our fund and passing on the Chinese investment to us at the same time?”

Henri Arnault shook his head greatly.

“Absolutely not. We listened to the board of directors’ demands and thought this. It would be good to propose a Chinese investment to Victoria Fund on the condition that Victoria Fund’s investment is maintained.”

Jung Hyun-woo’s voice was still cold.

“You’re saying you won’t leave our fund, so buy the defaulted bonds.”

“They are not defaulted bonds. Chinese investment is still attractive.”

Jung Hyun-woo narrowed his brow slightly.

“If it was really attractive, you would have tried to persuade the board of directors somehow.”

“Charlie.”

Jung Hyun-woo raised his right hand and said.

“I know. I know that you have your own circumstances.”

Henri Arnault’s face was dark.

“Charlie, we had to choose one of the two.”

Withdrawing from China and stopping short selling in Japan.

As of 1989, if you were told to choose one of the two, most people would have no choice but to choose the former.

“So, what’s the price?”

Jung Hyun-woo didn’t seem to like dragging out the story.

Henri Arnault had no choice but to take a long sigh inside at his colder-than-expected reaction.

‘Hoo… As Charlie said, these are bonds close to default. But we have no choice but to dispose of these defaulted bonds.’

He clenched his fist slightly and replied.

“JP Morgan has invested in China for the past four years, and the total amount is 4 billion dollars.”

Jung Hyun-woo asked again.

“The Chinese economy has grown over the past few years, so the value of the stocks or bonds you want to sell isn’t 4 billion dollars, is it?”

Henri Arnault nodded.

“That’s right. As of last December, the value of the Chinese bonds and company shares we hold was 12 billion dollars.”

Jung Hyun-woo thought that they had invested a lot in a short period of time.

‘That means JP Morgan saw the Chinese market as high as that.’

JP Morgan’s judgment was not wrong.

China was a dragon that was waking up.

In the early 2000s, no country achieved greater economic growth than China.

If it was an investment looking ahead 10 years, JP Morgan’s investment was close to perfect.

But they were losing their initial intentions in the face of the Tiananmen Square incident.

“You’re not saying you’re going to get all 12 billion dollars, are you?”

Both Henri Arnault and Jung Hyun-woo knew that everything had changed after the Tiananmen Square incident.

“How about 6 billion dollars?”

Henri Arnault wanted to dispose of the stocks and bonds at half price.

“Are you saying you’re going to get the full price?”

“Charlie…….”

“The value of Chinese companies has plummeted since the Tiananmen Square incident. Are you still talking about 6 billion dollars?”

“I’ll concede up to 5 billion dollars.”

Jung Hyun-woo let out a short sigh and said.

“Hmm……. Let’s make it 4 billion dollars.”

One-third of the value as of last December.

It was, of course, lower than the amount Henri Arnault had targeted.

“Is it a payment in installments?”

“Let’s do it in a lump sum.”

Henri Arnault thought he had no choice but to compromise at this point.

‘If I drag it out any further, there’s a high possibility that these conditions won’t come out.’

He held out his right hand and said.

“I accept.”

It was an unexpected boon for Jung Hyun-woo. But he managed his expression and shook his hand.

“I think we should help each other in difficult times.”

It meant that he was helping JP Morgan’s difficulties from this side.

Henri Arnault did not refute this.

“JP Morgan always thinks of Charlie as a good friend.”

Summer of 1989.

Victoria Fund announced that it would acquire JP Morgan’s Chinese investment shares and bonds for 4 billion dollars.

And the next day.

Victoria Corporation’s stock price plummeted by more than 5%.

The Nikkei index broke 38,000 for the first time in history.