This Is How I Became a Chaebol

090 : A miracle at the steel mill

Pittsburgh Hotel, Grand Ballroom.

Foy, president of the Pittsburgh Steel Federation and president of Coopers, was dumbfounded.

It was because a huge number of guests gathered at the Pittsburgh Steel Annual Meeting, where US steelmakers gathered to discuss next year’s investment plans.

“welcome. President Siemens Lewis.”

“Haha, I see you here.”

“Nice to meet you. President Westinghouse Wesley.”

“It’s been a while, haven’t we?”

I was busy standing at the front door and saying hello.

All of this happened after an official letter arrived from a small country in the Far East, Korea, to send a special envoy in charge of the integrated steelworks.

“Ah, welcome. Director Van Flint.”

“A lot of people have come. It will be a fun party.”

“Ha, even Ms. Nancy.”

“Oh, Mr. Poi. I have a blush on my face. Anything good for the steel industry?”

President Poi was surprised inwardly.

In other words, Van Flint, an outside director of BR, a big hand in the military-industrial complex, and Nancy, an international security adviser at the Ministry of National Defense, were also attending.

How far did the replacement invitations go?

Even Fritz, the West German ambassador to the United States, was attending, wondering what was going on at the party.

“Oh, I was a little excited about the party today. It’s an unexpected boom. Who the hell is the special envoy to the Republic of Korea?”

“Here he comes. He is a peculiar Asian.”

Nancy pointed to a man who happened to be walking this way.

***

“Hello, Mr. Poi. My name is CS Woo.”

“Welcome, envoy. I was waiting.”

President Poi looked at me with a mixture of curiosity and doubt.

At first glance, it might seem strange that the state would send a special envoy to a social party for a private company.

Don’t make it complicated.

I just came because I liked the time and place.

“Welcome, CS.”

“Long time no see.”

“Isn’t it strange that the Korean special envoy is coming when Aide Nancy and General Van Flint came like this?”

I don’t know Nancy, but what happened to General Van Flint? I know that BR doesn’t handle steel.

“Ah, that’s right. It’s an honor to use the Pittsburgh Conference for a major meeting. Eat inside.”

When I made it clear that I had come to negotiate with them, President Poi’s expression instantly changed.

It seems that he has not taken seriously the idea of receiving investment for a 1 million-ton steel mill.

Nearly a hundred people were crowded at the party.

Many more people came than I sent invitations to. Well, the party at the petrochemical complex earlier this year was really great.

In particular, DuPont, which obtained a Kevlar license, had more than enough money invested in Korea before it even started operating its factory due to soaring stock prices.

“Hey, these guys’ parties are really great.”

Director Seok’s eyes widened as he looked around.

Not surprisingly, champagne bottles were piled up like a mountain under the splendid chandelier, and the atmosphere was ripening with the performance of a chamber orchestra.

Dozens of waiters roamed the banquet hall, offering unlimited whiskey and champagne, and caviar and other snacks that went into bites were lined up.

“Are you surprised by this much? The petrochemical vice minister party was even bigger. There was even a small opera performance at the Champagne Falls.”

Deputy Minister Yeom Won-cheol shrugged his shoulders and acted condescending to Director Seok.

“Were there more people back then?”

“then! There were so many people offering loans, so we picked one and signed a contract. Right, boss Wu?”

“It will be a little different from then. The three of us need to get our heads together. Petrochemicals are not likely to be scammed as facilities, but steel is not. West Germany or America would have been eager to sell us junk equipment.”

“Selling junk equipment?”

“New steel mills and new steel manufacturing methods are being developed every day. Isn’t the recent rapid progress of the Japanese steel industry also thanks to the adoption of a new oxygen steelmaking method called the LD converter? Of course, developed countries like the US and West Germany will also sell their existing facilities and move on to new facilities.”

Heavy industry booms roughly every 10 years, and innovative technologies emerge every time, and the trend was particularly strong in the late 1960s.

It was a time when 500,000-ton steel mills in India, Pakistan, the Philippines, Indonesia, Malaysia, Turkey, and Brazil were established like mushrooms after rain.

Although so many steel mills have been established, all of them, except for Pohang Iron and Steel in Korea, have not been profitable and have been in the red for a long period of time.

This was partly due to Pohang Steelworks engineers frantically increasing the operation rate, but it was also because advanced companies in charge of the construction pushed outdated facilities and blast furnaces at unreasonably high prices for steelworks in other countries.

In this history, we will be able to go beyond overwhelming those steel mills in Chaesanseong, and even try to win orders for plant construction when we expand in the future.

Today’s party is the first button.

“Chairman, I don’t know why these well-to-do American companies keep our steel mills in check. Honestly, the US steelmaking capacity is over 100 million tons, so isn’t it 100 times more than ours?”

“In terms of scale, yes. But you saw Pittsburgh on the way here, right? It is inland where raw materials must be moved by rail. It is a place where competitiveness cannot be maintained if competing steel mills from other countries grow. Pittsburgh steel companies know that.”

“No, then why did the US build a steel mill in a place like Pittsburgh in the first place?”

Assistant Minister Yeom Won-cheol asked.

“Deputy Minister. That’s because self-sufficiency came first even during World War II. Here in Pittsburgh, we used Pennsylvania coal and iron ore near Lake Superior. But, it’s different now. It is much more advantageous to buy cheap raw materials from overseas.”

Director Seok answered instead of me.

“Ah, then the net profit rate would be much higher if we built an integrated steelworks on the seashore.”

“you’re right. You need to build an ironworks by the sea so that you can continue to grow in size. Even here in the US, steel companies have no choice but to invest in our steel mills. Selling equipment, collecting dividends, etc.”

As I concluded, both nodded.

When you come out, do your eyes change?

There is something to be learned just by looking at the location of the factory.

“Hello, Mr. Wu. My name is Fritz, the West German ambassador to the United States.”

“Nice to meet you. I wanted to see you.”

I wanted to know where it was, but I found it.

The West German ambassador looked carefully at the briefcase I was holding.

It must mean that it is an accident report.

“Is that the report?”

“no. There shouldn’t be any need to disclose the accident report here.”

“If you want compensation, negotiate separately…”

“Ah, rather than negotiating, I would like to know if you are willing to invest in a steel mill in Korea.”

“I came with Siemens and Demark. Please discuss the technology separately.”

Well, I didn’t bring Auto or SMS either. As a steel plant company that is becoming more famous in the 21st century, it can be said that it is natural.

It was good that Sambok was sent separately.

“Do technical discussions with them? Great, it will make things easier for us too. Director Seok Ki-hoon, could you negotiate with the West German ambassador?”

“Yes, Chairman.”

“this person is…”

“Since he is fluent in German, negotiations will be easy. And we are thinking of compensation as 20 million dollars, so please take care of it, whether in cash or in kind.”

“Ugh! Twenty million dollars. To make such an outrageous request.”

The West German ambassador blushed, but there was no reason to deal with him. Once you have gripped the hilt, you must wield it with the determination to kill. If you wield it clumsily, you will hurt each other.

“If it is a ridiculous request, you can refuse it. Director Seok, take her to a quiet place.”

“Yes, Chairman. Ambassador Prinz, I will take you this way.”

Director Seok headed upstairs even though this was his first time in a position like this. To pinpoint where the quiet meeting room is is, as expected.

“Deputy Minister Yeom. You have to represent Korea to greet guests, right? All you have to do is emphasize the justification of the integrated steelworks.”

“Yes, please leave it to me.”

Looking at Vice Minister Yeom, a face-to-face meeting was enough.

I had to filter out the VIPs to get their investment.

“Hello, Mr. Wu.”

“Haha, nice to meet you. Excuse me, but who are you?”

I started with a toast because someone offered me a glass.

“This is Wesley, president of Westinghouse. We met at the petrochemical vice-ministerial meeting, don’t you remember?”

“Ah, Mr. Wesley. I remember now.”

what? Westinghouse is friendly.

At the petrochemical vice-ministerial meeting, you only drank and went.

When I told them to invest in two 100MW-class power plants, they laughed.

“Haha, I was a little sad at that time. You could have given me one 100MW power plant.”

‘You refused? Stupid guy.’

It was embarrassing, but I couldn’t say it straight away. If you think about it differently, doesn’t it mean that you really want to invest this time?

Bona Mana, Korea really didn’t know how to build a 100 MW power plant and refused to do so, and then the shareholders would have been crushed.

At times like this, you just need to come up with an excuse that will make you feel uncomfortable.

“At that time, there was a condition for Bechtel to train our engineers. If Westinghouse had made a similar offer, I would have given one.”

“Ha, did you sign a contract like that?”

“I was going to entrust the power plant to Bechtel this time, but if you invest in a comprehensive steelworks, think again about ordering a power plant.”

“Hahaha, this time it will be quite big, right?”

“of course. We are thinking of starting with two 50 MW power plants.”

There are many words to describe the nature of the steel mill, such as national infrastructure industry, equipment industry, resource transportation industry, money-eating hippo, etc., but it is basically a resource-consuming industry.

Although it consumes tremendous resources, it is an industry that has a huge impact on the front and rear, similar to the petrochemical industry, so it is essential for a country that wants to become an advanced country.

Moreover, unlike the machinery industry, where tens of thousands of parts technologies must be developed simultaneously in the petrochemical and steel industries, high-quality finished products can be produced if the factories are equipped with the latest facilities and the latest processes are used.

True to the word “equipment industry,” it is relatively easy to introduce and develop technology because the technology is inherent in the facility itself.

That’s why I try the steel mill first.

Steel mills tend to develop at an unimaginable speed if the first button is put on properly.

“Haha, two 50MW power plants? Then that would be 100 MW as well.”

Welsh’s boss smiled with satisfaction.

It’s as if the order has already been received.

“Huh, why is Westinghouse holding my guests?”

“General.”

Van Flint appeared out of nowhere and joined the conversation.

“General Van Flint, what are you doing?”

“What is it? Our BR company also wanted to open a steel mill. Rather, why is Westinghouse here? Isn’t it a place where you can’t do a steel mill?”

What are you talking about? What kind of steel mill does BR do?

And don’t Westinghouse and BR have a good relationship? Why are you scratching each other’s nerves like this?

“General, since when do you say BR started operating a steel mill?”

“Since when? Hey Wales. We can do anything, anytime. I have something to say to my guest, so please don’t interrupt. CS, move your seat.”

Van Flint pulled me off with a provocative remark to the Welsh boss.

Why do the two companies feel a bit off?

No matter how big BR is a military-industrial complex, isn’t Westinghouse a formidable company?

“Van, it’s not too drastic. Westinghouse is also qualified to listen to CS’s investment conditions.”

Even Nancy intervened with a hook.

Naturally, he also provided me with an opportunity to talk about the investment conditions. At Nancy’s words, the eyes of the audience immediately turned to me.

“good. The conditions for investing in integrated steelworks in Korea are very simple. A total of 170 million dollars is needed for 1 million tons of steelmaking capacity, and the Korean government plans to invest 20 million dollars.”

“… you’re going to be investing $150 million?”

Nancy was amazed.

I understand that the petrochemical complex is a large-scale factory group, so it is 300 million dollars, but it meant that one steel mill was worth 150 million dollars.

Of course.

I’m going to build a steel mill with state-of-the-art facilities.

“Korea is not only looking at American companies. We are trying to recruit investors from all over the world. We intend to install state-of-the-art facilities through bidding from the world’s leading steel companies, and operate them 100% to maximize the profits of our shareholders.”

“It’s a state-of-the-art facility…”

Van Flint made an inquisitive look.

I’m sure it feels good.

I’ll show you miracles in the steel mill like kabla.

“It is good even if it is not an equity investment. For general commercial loans, we guarantee 7% per annum with a 3-year grace period and 12-year repayment terms. Of course, only for amounts over $10 million.”

“CS, I’m not saying things like that carelessly.”

Nancy and all the partygoers were surprised.

That would also be the case, at this time, the interest rate on loans was 5-6%.

Even if you give 1% more interest, you have to pull the money as much as possible. An oil shock will occur at the point of completion of the steel mill, and then steel prices will skyrocket along with oil prices.

Rather, it would be cheaper to pay 7% interest than to pay dividends.

“Lady, I am a special envoy sent by the Korean government. I don’t speak carelessly.”

I toasted Nancy and politely warned her.

It’s good to help me, but it’s difficult if you do me.

This is a business with the state behind it.

“Now, think about how much each of you will invest. Don’t we have something to say to each other? Business has procedures.”

Van Flint threw a word at the buzzing crowd at the unconventional interest and began weeding out the VIPs.

“Will General Van Flint serve as observer?”

“good. If you ask me to be an observer, I will do it. If you ask for a blueprint for the steel mill, I will give you the blueprint, and if you ask for equipment, I will give you the equipment.”

Hey, BR company is coming out hard.

“This is Snyder from Blonox. We can also provide equipment. Let’s sit down together.”

Hey, is Blonox coming out so aggressively?

“Don’t forget the Westinghouse.”

“Can I hear Siemens too?”

“I hope our Demark will also invest.”

“The United Kingdom did steel before the United States.”

“When it comes to steel, even Italy is not easy.”

Yellmann of England and Impianti of Italy also entered into negotiations.

“Haha, everyone knows that the host of this party is our Coopers company, right? I will take you inside.”

The president of Coopers, Foy, jumped out and opened the door on the other side.

They let the VIP in the door and shut Nancy last. As if the others were small pups.

Including BR, 4 American companies, 2 in Germany, 1 in the UK and 1 in Italy, plus the Silverstein family, who could be entrusted with legal procedures related to finance, were with us.

‘Is this combination good?’

It was an amazing combination to be able to load everything from raw materials to facilities at the integrated steelworks at once.

Today, Korea’s No. 1 integrated steelworks will be launched.