Bowing Down, Part 2
Unlike its neighboring Middle Eastern countries, Dubai, lacking in oil resources, has long developed as a logistics hub in the region.
In the 2000s, Dubai’s rapid development, fueled by massive foreign capital and large-scale construction projects, became a symbol of hyper-growth.
In July 2006, Dubai, an autonomous government within the United Arab Emirates (UAE), recognized the need for a company to spearhead its massive reconstruction projects and established Dubai World.
Dubai World, a state-owned enterprise, led the charge in this extraordinary development. It announced plans for the world’s largest artificial island, Palm Jumeirah, the Palm Jebel Ali bridge project, and the iconic seven-star hotel, Burj Al Arab, as part of the Dubai World Central plan.
Dubai World Central aims to transform the area around Al Maktoum International Airport into a global city center, handling 160 million passengers and 12 million tons of cargo annually upon completion.
Additionally, $2.6 billion was invested in logistics facilities in the Jebel Ali Free Zone, and a massive urban redevelopment project was announced to create a skyline rivaling New York’s.
With confirmed investments reaching $30 billion, the golden—or rather, oil-rich—land continues to lure global enterprises.
Jin Dong-gi found himself welcoming Lee Hak-jae’s proposal to join hands in such a venture.
“I hear Sunyang Construction, Civil Engineering, and Trading are heavily invested in the ‘Burj Dubai’ project?”
The Burj Dubai, which broke ground in 2004, is the epitome of Dubai’s skyline. Including its spire, it stands at 829.8 meters, with a building height of 828 meters and 163 floors, set to become the tallest man-made structure upon completion.
Jin Dong-gi, though slightly taken aback by Lee Hak-jae’s comment, maintained his composure.
“We’ve deployed a large workforce, but we still have plenty of key personnel available.”
If HW Group could provide the necessary manpower, resources, and funds, operations would be much smoother. However, showing any weakness might invite Lee Hak-jae’s cunning tactics.
Maintaining an air of confidence is crucial in negotiations.
“That’s good to hear. Anyway, I hope you’ll seriously consider my proposal.”
“What scale are you envisioning, Chairman? An airport? A new city? Or logistics?”
“The more, the merrier, wouldn’t you say? If we can take it all on as a turnkey project, that would be ideal.”
Jin Dong-gi frowned at Lee Hak-jae’s predictable response.
“Why be so vague when you know the details?”
“Funding is not an issue. We have Miracle as a solid backer, and HW Group’s retained earnings are substantial. As I mentioned, we lack experience and technical prowess. That’s why we need to complement each other’s weaknesses in a consortium, don’t you think?”
Lee Hak-jae then presented an option.
“I’m offering this out of old friendship, but if you’re not interested, just say so.”
Objectively, it would be wise to join forces immediately. It’s prudent to avoid those who ask for money for a good business plan, but no merchant would refuse a partner with ample funds.
Yet, considering old ties, it would be unusual to make such an offer. Sunyang Group might have fond memories, but for its two vice-chairmen, only bad ones remain.
What is he really after?
As Jin Dong-gi scrutinized him, Lee Hak-jae chuckled softly.
“If you’re not interested, let’s pretend this conversation never happened.”
“You know this isn’t a decision to be made on the spot.”
“I know, but your expression doesn’t seem too welcoming.”
“Who likes sharing the pie?”
“The pie is so large that if you don’t share, you might just end up watching. Anyway… think it over and let me know soon. I can’t wait forever.”
“If I refuse, you’ll partner with someone else, right?”
“Of course. In fact, Daehyun approached me first. They must have heard I was preparing to rally companies like Seongho Group and Namgwang Group, which are a bit lower in the rankings.”
Jin Dong-gi knew it was all bluff. He simply turned future intentions into past actions.
It was a signal that if Sunyang refused, he would proceed in that manner.
“I’ll conclude my positive review quickly and get back to you, Chairman. After all, Sunyang Group is your old home, isn’t it? Us working together would look best.”
“Looking good isn’t enough. We need to ensure mutual benefits. Let’s wrap up the discussion here and finish our meal.”
The atmosphere remained pleasant as they continued their meal. However, Jin Dong-gi couldn’t shake the feeling that Lee Hak-jae’s proposal might be a trap.
A trap with the enticing aroma of cheese.
Yet, the trap itself remained unseen, only the alluring scent of cheese lingered vividly.
“I’ll take it as if I didn’t hear your unreasonable request, Uncle.”
“Why is it unreasonable? Isn’t it rational?”
“It’s not about rationality or unfairness. It’s beyond my authority.”
Is it a trait of men to grow more shameless with age? Or is it just a trait of the men in our family?
My second uncle suggested diverting the funds Miracle plans to invest in HW Group for the Dubai boom directly to Sunyang.
He must know that I am aware of his meeting with Chairman Lee Hak-jae, yet he still tries to cut in line.
“Miracle wouldn’t lose out either, would it? HW Group would just be a cushion. The main project is with us, Sunyang.”
“I understand, Uncle. But Korean Miracle now operates under board decisions, with final approval from the U.S. Since CEO Oh Se-hyun is practically retired, this was a decision from the U.S. side. I can’t even attend Korean Miracle’s board meetings. My role is as an analyst.”
“I think you have more decision-making power than that.”
“Yes, I do. I’m a senior analyst with a strong voice. That’s all.”
I firmly stated to the skeptical uncle.
“And Miracle is HW’s major shareholder. Why would they prioritize Sunyang over their own family?”
“Is that so? I had a brief moment of false hope.”
His expression changed, but he didn’t seem disappointed.
“Then how about this?”
This was it. My second uncle’s real purpose for probing me was about to be revealed.
“As you know, the new city construction in Dubai requires a massive upfront investment. Chairman Lee Hak-jae’s consortium proposal is about being the financier. HW, formerly Daeah Construction, is useless for such large-scale projects. It’s a ploy to fund and steal our know-how.”
He was way off the mark, but I nodded as if in agreement, listening intently.
“Funds can be sourced from anywhere. But I see no reason to use external funds.”
“Right. Use the group’s funds and only bring in external funds for the shortfall.”
“But the heavy industry sector has already poured money into the Middle East. There’s no financial leeway. The remaining options are electronics and finance.”
Could it be true?
Is the capital of the core construction and heavy industry sectors really dried up?
“Pulling funds from electronics is tricky… How about you prepare the funds from the finance sector? That way, we don’t need to involve HW.”
I needed to answer carefully. Was he genuinely interested in using internal funds, or was he probing because Chairman Lee Hak-jae approached me first?
In such situations, it’s best to first clarify that it’s unrelated to me.
“I don’t have spare funds either.”
Keep the answer short. Long explanations can sound like excuses or lies.
My second uncle looked unconvinced.
“A financial company with no money? Do you not want to do business with me?”
“No, that’s not it. It’s true. Since two years ago, all spare funds have been invested in U.S. derivatives. If you’re doubtful, you can verify it yourself.”
“Derivatives?”
“It’s a stable investment yielding over twice the market interest rate of around 4%.”
“All-in, not diversified?”
“Yes. Diversification is standard, but there are no other options. I only select triple-A rated products. It’s company funds, so safety comes first.”
“Twice the interest rate, triple-A rated? That sounds too good to be true.”
What is this now?
His eyes change when it comes to making money.
“Exactly. Why else would I use all the company’s spare funds?”
If the group can’t use its funds, will my uncle choose Chairman Lee Hak-jae? Or will he curb his greed and proceed within his means?
Choosing the easy way is business, not entrepreneurship.
Isn’t Vice Chairman Jin Dong-gi a businessman, after all?
“Take a look at this. It’s a joint proposal from Jin Dong-gi.”
Chairman Lee Hak-jae seemed a bit irritated. The proposal suggested HW was being taken for a fool.
“Just put up the money and take a small profit, is that it?”
“With a bit more than bank interest.”
“If you don’t like the tone, then forget it. That’s exactly what it says.”
“Exactly. They shouldn’t be in a position to be so relaxed… Do they just not want to deal with me?”
“They’re testing the waters, it seems.”
“Testing me?”
“Yes. They’re assuming you wouldn’t approach with good intentions. They’re sure there’s something more, but not knowing what makes them uneasy.”
Chairman Lee Hak-jae shook his head slightly.
“The partnership between HW and Sunyang Construction is off. This guy won’t bite.”
Then we need to make him bite.
“Maybe the bait isn’t tempting enough. Let’s throw something bigger.”
“What? They don’t even want money.”
“But they hate seeing others make money even more.”
“What do you mean? Be clear.”
He hadn’t yet caught on to the meaning behind my smile.
“Wouldn’t they bite at around 300 billion?”
The man’s face showed signs of irritation as I continued speaking in a way he couldn’t understand. Before he could get angry, I quickly interjected.
“Think of it as losing three hundred billion and just go in alone. Let me remind you, we’re not just pretending to go in; we’re actually doing it. Either way, we won’t get paid for the construction. Or maybe we will, but it’ll remain a bad debt for a very long time. But if we go in solo, they’ll believe we’re serious.”
Even the thought of losing three hundred billion didn’t faze him much.
Having nothing but money can be incredibly convenient at times like this. It allows you to change the game whenever you want without a second thought.
To others, it might seem insane, but that’s the privilege and power of having wealth.
“Let’s use a bigger bait,” Chairman Lee Hak-jae said with a smile.
“I’ve already laid out a bluff, but if we turn it into reality, the stakes will rise. I’ll bring in Seongho Group and Namgwang Group. Each will put in three hundred billion… No, let’s make it an even trillion and head into Dubai. Vice Chairman Jin-dong-gi will be caught off guard!”
When three mediocre players gather around the feast, they’ll rush in, eager to take the lead. With Chairman Lee Hak-jae not alone, any suspicion will vanish…
I almost wanted to slap my knee in admiration.
Our Chairman Lee, truly a master of the game.