Korean TV series: King of Peninsula 1997

Chapter 585: The increasingly fierce competition
By February, the feud between Daying Group and Daying Ocean had become known to everyone.

This incident also involves all walks of life on the Korean Peninsula.

Since January, the media controlled by the Daying Group has taken the lead in publishing many statements.

For example, Daying Marine, a pillar enterprise in Busan, has suffered a huge loss due to poor management by CEO Zhu Mengyuan.

Such truthful statements are still a minority, and what is more common are groundless attacks and slanders.

Under Zhu Mengyong's instructions, the true nature of the struggle among chaebol families was exposed to the people of the Korean Peninsula and even to people in other countries who were paying attention to this matter.

"Daying Ocean has always been a part of Daying Group, but now the actual management rights are not in Daying Group, but exist as an independent company. Under the current management status, should it return to Daying Group and work together to solve the problems of Daying Ocean?"

Zhu Mengyong, chairman of Daying Group, even publicly declared at a press conference, "Some people have messed up Daying Ocean. If these people continue to mess around like this, Daying Ocean may not be able to survive for two years and will collapse."

"As the chairman of Daying Group, it is my duty to rebuild Daying Ocean!"

In front of the camera, he also revealed the current situation of Daying Ocean, and claimed that if Daying Ocean did not return to the embrace of Daying Group, it would probably go bankrupt and liquidate soon.

This made many dignitaries who had not paid attention to the Daying Ocean in the previous few years turn their attention there.

You don’t know until you see it. Only when you see it will you realize that this is a huge ocean of troops far away in Busan.

It was at its peak when Zhu Mengyuan first took it away, but in the past two years it has been a complete false prosperity.

Judging from the current situation, the entire ocean of Daying is like an eggplant hit by frost.

Sea transportation is still barely acceptable, but the shipbuilding industry has become a huge money-making pit, relying entirely on sea transportation to make money.

The reason for the losses in the past two years is that the shipping situation on the Korean Peninsula has been deteriorating. In other words, the company has a strong foundation and has been able to maintain the appearance of false prosperity for almost two years.

In February, Li You also took time to listen to Ding Qing's report. The ocean situation in Daying is getting worse every year.

Daying Ocean has more than 120 vessels including modern container ships, special gas tankers and bulk carriers, and seven well-equipped modern container terminals.

But even such a powerful camp ocean is now in a predicament where it has few ships to send out.

Simply put, only less than half of the ships can be used, and a large number of orders have been divided up.

This does not include the expanded shipyards. Given the current market conditions, there are fewer and fewer customers placing shipbuilding orders on the Korean Peninsula.

At that time, Zhu Mengyuan made some small moves, and although he did not gain power over the entire Daying Group, he did gain control of Daying Ocean.

Originally everyone thought that these were the two heroes of the Zhu family, rather than the two bears of the Zhu family like the Chen family of Shunyang. Who would have thought that the condition of Daying Ocean has become worse and worse in recent years, and even its orders have been snatched away by third-rate shipping companies from other countries.

It's not a big deal if one or two companies grab orders by relying on their low prices, but there are too many companies and the prices are not cheap at all.

If you dig deeper, you will find that many shipyards and shipping companies have close ties with Daying Group.

There are even a few joint ventures opened by Daying Group in China.

In the past two years, Zhu Mengyong, the chairman of Daying Group, has continuously injected capital into small shipyards and shipping companies, and then forced them to snatch orders from Daying Ocean, secretly sounding the war with Zhu Mengyuan.

If Daying Ocean can smoothly fall into Zhu Mengyong's hands, then these small factories and companies will be able to become a boost to Daying Ocean.

But if they are still controlled by Zhu Mengyuan, then these small factories and companies will be another knife stabbing into the existing wounds of Daying Haiyang.

The shipping industry on the Korean Peninsula is already extremely weak, and coupled with the power struggle instigated by Zhu Mengyong, the current internal and external troubles of Daeyoung Ocean are really visible to ordinary people who know a little about business. The headquarters of Daeyoung Ocean in Busan is in a precarious situation.

Even Daying Haiyang, or Zhu Mengyuan's former supporters, felt that they could not see any good prospects at all. They wanted to withdraw decisively from this quagmire, but due to Zhu Mengyuan's methods, they could not withdraw cleanly.

Over the years, Zhu Mengyuan has tried his best to try to distance Daying Ocean from Daying Group.

But Daying Ocean has been a part of Daying Group from the beginning, where interpersonal relationships are even more complicated and close relationships between management are everywhere.

It's a tangled mess and there's no way to break the connection between them.

Many officials in the Blue House are now running around in a panic.

You should know that the Korean government attaches great importance to the development of the logistics industry and has formulated a '20-year logistics industry development plan' to ensure that the Korean Peninsula can become a modern logistics power in the new century.

The Ministry of Commerce, Industry and Energy even formulated special policies to develop the logistics industry between 2002 and 2006, in order to reduce logistics costs and enhance corporate competitiveness.

Even in 2004, it further supported large logistics companies such as Daying Ocean and Kinmen Trading.

They didn't expect that with all the favorable policies and promotions, Daying Ocean, as the leader in shipping on the Korean Peninsula, would fall to such a state.

"According to the investigation, Daying Ocean initially fell into a vicious cycle due to overcapacity, and freight rates were long-term depressed. At first, it was able to break even, but gradually it could not pay off the debts incurred for development and expansion. However, Daying Ocean briefly made a profit in 2004."

In front of Li Lianchang, the Minister of Industry, Commerce and Energy felt more and more guilty the more he spoke, because everyone knew that the short-term profit in 2004 was due to the financial support provided to Daying Ocean by the Blue House and the Busan government.

"Go on reading," Li Lianchang sneered. He had read the document this morning.

The minister gritted his teeth and said, "In 2005, the losses began to expand continuously. In the first half of 2006..."

He paused. Seeing the number again, he still felt a little shocked. "The loss is 500 billion won."

"This doesn't even include the debts," Li Lianchang stared at him coldly, "How much debt does Daying Ocean have?" "Look at what Zhu Mengyuan has done," Li Lianchang almost threw the investigation documents in the face of the Minister of Industry and Commerce and Energy in front of him, "Is this your achievement?"

Li Lianchang was really tired. It was clearly the last year of his presidency, but something strange had happened again.

"Say!"

"As of the end of last year, the debt exceeded 4 trillion won, and the debt ratio was as high as 650 percent."

"That is to say, Daying Haiyang is right under your noses," Li Lianchang was so angry that he laughed. He looked at the Minister of Industry and Commerce and Energy and the officials from other departments behind him, "Now it is in debt of nearly 3 billion US dollars. Is that what you mean?"

Li Lianchang was numb because the whole thing happened during his term of office and he couldn't even blame the previous government team.

If he does not take care of it this year, the subsequent government team will bring them out and repeatedly flog them when they encounter such a thing, telling everyone that it is the fault of Li Lianchang's generation of officials.

After a long silence, Li Lianchang said in a deep voice: "What will happen if we continue with the current situation?"

The Minister of Industry, Commerce and Energy turned his head to look at his colleagues, but found that no one looked up and came forward, so he could only bite the bullet and analyze, "If we continue like this, there are only two possible results."

"We will swallow up the Daying Group, or hold on for a while before bankruptcy and liquidation."

"But due to the actions of the Daying Group in various places and the attacks during this period, Daying Ocean may only last for two years at most."

Li You's previous life was the same Hanjin Shipping that went bankrupt and liquidated. Although it also encountered major problems in 2007 and 2008, it made a brief profit in 2009 and managed to hold on until 2016 when it went bankrupt.

But that's because Hanjin Group is not just Hanjin Shipping, but Daying Marine is just a subsidiary. Even if Daying Marine's shipping capacity ranks tenth in the world, it is useless.

Because the Daying Group is dealing with it.

It is even because of the overcapacity that it is becoming increasingly difficult.

"If the company goes bankrupt, the first thing that will happen is that the shipping capacity on the South Korea-U.S. route will drop sharply, and shipping costs may increase tenfold. The surge in shipping costs will force multinational companies to adjust their logistics routes. For example, goods from the U.S. East Coast will need to be transported by land to the West Coast and then shipped by sea, rather than directly from the East Coast to the Korean Peninsula.

At the same time, cargo owners will also worry about rising costs, which will weaken the price competitiveness of their goods and will inevitably lead to conflicts with other shipping companies over freight pricing. "

“After bankruptcy liquidation, is it possible to save the company through capital injection?”

"With a debt gap of 4 trillion won and the required liquidity," the minister laughed bitterly. "No one would be willing to do that."

"No one would be willing to do that." Li Lianchang closed his eyes. "That's a good point."

Li Lianchang seemed to be thinking about something. Zhu Mengyong's attitude on this matter was very simple. He wanted to completely take over Daying Haiyang and not give anyone, including the government, the opportunity to intervene.

But what they, the Blue House, want to ensure is that Zhu Mengyong will never push Zhu Mengyuan into a desperate situation and force Zhu Mengyuan to apply for bankruptcy liquidation.

This right is in Zhu Mengyuan's hands.

If Daying Ocean, the largest shipping company on the Korean Peninsula, the vital logistics industry of the country, and the pillar of Busan, files for bankruptcy protection with the Seoul Central Court, the consequences will be disastrous.

If this were to happen, two-thirds of the shipping industry on the entire Korean Peninsula would come to a standstill. Ports around the world would refuse to allow their ships to dock in order to avoid losses, as they were worried about the freight payment issues of Daying Ocean Shipping, which was under bankruptcy protection.

And all the people in the shipping industry chain, including those shipowners who bought ships for logistics business, and the ports that rely on the sea for their livelihood, those who drive trucks to transport goods at the ports,
They all face the dilemma of being unable to collect income such as rent, and no one even pays the workers who unload and load the goods.

According to the court's lengthy bankruptcy liquidation process, Daying Ocean has dumped all its debts on related ports around the world, as well as companies and employees in all related industries, becoming a defaulting company, and the banks are the ones that suffer the most from the default.

Looking at the Korean Peninsula, the collapse of Daeyoung Marine, the pillar of Busan, has had the most serious impact on Busan's economy. Countless employees of Daeyoung Marine have resigned and been laid off, and dock workers who earned money by doing manual labor have also lost their jobs.
Small companies in the industrial chain will also face bankruptcy, which is an inevitable chain reaction.

The number of people affected will be calculated in hundreds of thousands, which is also the influence of the real top chaebols.

In fact, the same was true for the previous Shunyang Group, except that Shunyang fell apart and was swallowed up piece by piece by Li You. Although the last time he swallowed up Chen Rongji's industry was a big deal, in fact, this time, the industry of Shunyang Group that was swallowed up was only about one-third, which was slightly smaller than Daying Ocean, and it did not have so much debt and losses.

Therefore, Li Lianchang could not allow Daying Ocean to go through bankruptcy liquidation. If anything happened to any big chaebol, the impact on the Korean Peninsula would be too great, and the government simply could not afford it.

Even a strong man like Jeon Young-joong would only use sticks to educate the chaebols when engaging in political struggles against them, but he would not really kill them.

Bankruptcy protection and bankruptcy liquidation are different. Bankruptcy protection can also be called bankruptcy reorganization, which means that when an enterprise is insolvent or obviously lacks repayment ability, the court declares it bankrupt in accordance with the law and can propose a bankruptcy reorganization plan.
Arrangements will be made on the term and method of debt repayment, as well as possible detriment to the interests of certain creditors and shareholders, and the company will continue to operate under the restructuring plan after approval by creditors and confirmation by the court.

If it is bankruptcy liquidation, the property will be converted and distributed through liquidation procedures to fairly repay all creditors.

Judging from the current situation, bankruptcy liquidation is simply not feasible.

"So." Li Lianchang narrowed his eyes, "We can only let the Daying Group handle it on their own?"

After all, South Korea itself is a peninsula country that is extremely dependent on the shipping industry. After the bankruptcy and liquidation of Daying Ocean, the leader of its own shipping industry, more than half of its capabilities will be lost.

"Zhu Mengyong will never let Daying Ocean go bankrupt," the minister frowned, "although bankruptcy reorganization is the best way for Daying Group to take back Daying Ocean, it can obtain the most advantageous resources at the lowest cost and cut off the rotten meat on Daying Ocean. The possibility of regaining profitability after the reorganization will also be greater."

"But the most important problem with bankruptcy reorganization is that other forces will definitely take advantage of the situation."

"Because bankruptcy reorganization is not a corporate merger and reorganization, it is not done by Daying Group itself, but by the national court to carry out this basic process."

"Now many smart people have started to seek help and apply for government support. The public telephone numbers of Busan City Hall and members of major political parties in Busan have been flooded with calls in the past few days."

(End of this chapter)