170 Company Restructuring 1 – PART 1

The internal auditor was giving a report to Gun-Ho on monthly profit and loss at Gun-Ho's office.

"The sales and the operating income have increased; however, because of our high-interest cost, we can't expect the ordinary income. The funds you put into this company when you acquired it, we used them to pay for the unpaid wages and some of the outstanding balance of credit purchase and accrued expenses payable that needed to be urgently paid."

"Hmm."

"However, we haven't been able to pay for the loans from financial institutions yet."

Gun-Ho hadn't paid off the loan from financial institutions when he acquired the company; otherwise, he would have spent additional tens of billions of won to pay for them. He actually could have paid off the loan with his cash—210 billion won in his stock account, but he didn't want to do it. He didn't want to touch the money that he made by selling his Kumho Chemical stock and he hadn't.

"I will protect my personal assets even though my business goes broke. Look at President Se-Young Oh. His personal assets became at risk when his business went broke."

"Can I see the current status of the loans for each financial institution?"

The internal auditor called for the accounting manager and asked her,

"Please bring the current status of the loans for each financial institution."

"Yes, sir."

The accounting manager came back to Gun-Ho's office. It didn't take her even 5 minutes.

The internal auditor said to Gun-Ho while sipping his green tea.

"Since we are paying the financial institutions on the loan interests on a regular basis, they don't pressure us to pay off the principal right away."

"Hmm."

"The problem is with the loan from non-bank financial institutions. President Se-Young Oh borrowed money from several non-bank financial institutions when he urgently needed money."

"Hmm."

"Among those non-bank financial institutions, we are paying high loan interest to Capital and Savings Bank. I feel like we are paying too much to them."

'Maybe I should pay off the loan from those non-bank financial institutions with my personal funds.'

Gun-Ho grinned then thought,

'Nah, I shouldn't.'

While Gun-Ho was thinking about the loans with high interests, the thing that President Se-Young Oh had said earlier crossed his mind. He said 'Son of a b*tch Korea Credit Guarantee Fund.'

"Oh, have you heard anything from Korea Credit Guarantee Fund?"

"We actually received a call from them the other day."

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"What did they say?"

"They said they would need to get your signature to extend the loan period since the company president's personal joint surety is expiring."

"Hmm."

"I told them you are on a business trip to Japan right now and you would come back several days later."

Gun-Ho thought he would have to do something about this loan of 3 billion won. All these debts came with the company, including the previous president—Se-Young Oh's personal joint surety when Gun-Ho acquired the company. They were the company's debt and Gun-Ho would have to pay for them since he was the owner of the company now.

'I will never personally guarantee the loan for my business.'

Gun-Ho was firmly determined on this matter.

At that moment, the general affairs manager entered Gun-Ho's office with a report. When he felt the serious vibe in the room where Gun-Ho and the internal auditor were sitting in, he hesitated to stay, and then he eventually left the room quietly.

After finishing discussing financial matters with Gun-Ho, the internal auditor left Gun-Ho's office. Gun-Ho stared at the current status of the loans for each financial institution that the accounting manager brought to him earlier.

"There are a lot of financial institutions that President Se-Young Oh borrowed money from."

Gun-Ho pulled out an electronic calculator and started calculating the loans.

"With about 9 billion won, I can get rid of those dirty loans from non-bank financial institutions."

Gun-Ho had about 10 billion won in his bank account in Gangnam, Seoul. He made a call to the branch office of that bank.

"Oh, President Gun-Ho Goo? How have you been? I'm so glad that you called us."

The bank branch manager made a fuss about getting a call from Gun-Ho.

"Will you be available this afternoon?"

"Yes, I will be here. I wanted to meet you as well, sir."

Gun-Ho drove to Seoul. It had been a while.

"Seoul is still so busy and that gives me a headache. I guess I am better off staying in Asan City."

When Gun-Ho entered the bank, the branch manager was talking with a client. Gun-Ho sat on a chair and waited for a moment. After 15 minutes or so, the branch manager walked out of his office with the client. When he saw Gun-Ho waiting outside his office, he was surprised.

"President Goo, when did you arrive? Why didn't you enter my office then?"

The branch manager led Gun-Ho to his office while making a fuss.

"Sir, you have funds in our bank that are just sitting there. It's such a waste. We have a very good program that you might be interested in investing your funds in."

"I actually came here to borrow some money."

"Borrow money?"

The branch manager was pulling out a pamphlet of the program he was about to show Gun-Ho, and he looked at Gun-Ho over his glasses when he heard that Gun-Ho wanted to borrow money instead of using his money to invest somewhere.

Gun-Ho handed his GH Mobile business card to the branch manager, and said,

"Actually I acquired a factory not long ago. The company has some loans from non-bank financial institutions and I want to get rid of them. I hope you could help me with this."

"Did you bring the company's financial statements?"

Gun-Ho gave a document to the branch manager.

The branch manager took quite some time and looked through the document carefully, that Gun-Ho brought in. When he was done with reviewing the paper, he smacked his lips.

"This company borrowed money as much as it could. No one will lend any additional money to this company."

"I don't think I want to use my personal money to pay for the company's loan."

"Of course not, sir. You definitely should not."

The branch manager looked at the document again.

"It's not getting enough sales revenue. I think you need business restructuring."

"Exactly."

Gun-Ho leaned back in the chair and crossed his legs. The branch manager was in his early 50s and Gun-Ho was in his mid-30s. However, Gun-Ho was changing in his attitude since he possessed a lot of money. He now acted as a big player from Gangnam. No one could see any clue about his past life as a factory worker from his current appearance.

Gun-Ho said to the branch manager with his legs crossed; he made it like a joke though.

"If you can't help me with this, I will take out all of my funds from this bank."

The branch manager didn't show any reaction to Gun-Ho's saying, but he seemed to think about something with his head tilted to one side. He then said something to himself.

"There might be a way out of this…"

"Did you find a good way?"

"When did you get the appraisal on the factory land?"

"I acquired the company when it was under the court receivership, so I would say the appraisal was done last year because they had to report it to the court."

"The money was borrowed from the non-bank financial institutions about three to four years ago. I guess the previous president had a really hard time running the company at that time."

"Hmm."

"That means that he borrowed the money at that time with the old appraisal."

"Hmm."

"This is good. President Goo, when you go back to the company, please have the original appraisal ready. I will visit the factory next week."

"To Asan City?"

"Yes."

"Hmm."

"And don't ever say that you would pull out all your personal funds from our bank. That really freaks me out."

Gun-Ho extended his hand to the branch manager for a handshake and smiled.