<h4>Chapter 148: Preparation for M&A (3) – PART 1</h4>


    Gun-Ho decided to meet the Mulpasaneop’s creditors who were not a financial institution but vendors or subcontractors. He selected five of them that had the highest amount of money to receive from Mulpasaneop. The total amount of debt owed to these five creditors ounted for over 50% of thepany’s total debt.


    “Two of them are vendors just like YS Tech and the other threepanies are suppliers of raw materials.”


    Gun-Ho smiled at the fact that YS Tech was not one of the top five Mulpasaneop’s creditors.


    “I guess the Mulpasaneop’s president paid YS Tech on time mostly since YS Tech’s president is his brother-inw. Mulpasaneop currently owed YS Tech only 300 million won.”


    Gun-Ho decided to meet with these three raw material suppliers first.


    “This supplier is a hugepany. Its president probably won’t want to meet a person like me. I guess I’d better contact a person in an executive or management level.”


    Gun-Ho contacted a director of one of the raw material supplierpanies.


    “Hello, Mr. Director of H Group. I am a managing director of Mulpasaneop. Can we talk today?”


    “Mulpasaneop? How things are going with the court receivership?”


    “I will talk to you about it once I see you in person.”


    Gun-Ho went to H Group Chemical in Dangjin City. Its factory was enormously big. Thepany was known to be hard to get in. Getting a job there was extremelypetitive. Thepetition to get a position as a college graduate was 100:1.


    When Gun-Ho arrived at the main gate, he left his ID with the security guard and sign on the guest book so they could let him in. The staff showed Gun-Ho to a small meeting room in the building. Even though Mulpasaneop was a smallpany,pared to H Group Chemical, Gun-Ho was its managing director; the staff treated him with respect.


    “Of course it is important to have a high position title in apany.”


    After quite a while, the director came to the meeting room with a manager.


    “I sent too many raw materials to Mulpasaneop on credit, and that put me in a difficult position in thispany.”


    The director who was short and obese startedining as soon as he saw Gun-Ho in the meeting room.


    “I apologize for that.”


    “I haven’t seen you in Mulpasaneop before. When did you join thepany?”


    “Not long ago, but I’ve heard a lot about you. I am aware that you have been favorable to Mulpasaneop and helped us a lot.”


    “Well, as a matter of fact, I made my personal effort to supply raw materials to Mulpasaneop on credit. Since we don’t get paid for the materials yet, I am in a very difficult position in thispany. So, has the court receivership been approved?”


    “They haven’t decided it yet. I’d like to ask you a question, Mr. Director. If apany took over Mulpasaneop, will H Group Chemical still supply raw materials to them as it has always done before? It seems that yourpany has provided 2 billion won worth of materials to Mulpasaneop on a monthly basis.”


    “If they could pay us the 5 billion won they owed to us first, then yes, we would keep supplying materials to them.”


    “If they could pay you the 5 billion won in an installment payment, would you agree to the payment n?”


    “No, we can’t take that deal.”


    “If you can’t ept the installment payment n, the potential buyer of Mulpasaneop would give up on acquiring thepany. If that happens, do you think you can still receive the 5 billion won overdue payment from Mulpasaneop?”


    “If thepany is to be sold, they should have money to pay off their debts, right?”


    Gun-Ho shook his head from side to side.


    “Mulpasaneop’s debt that was reported to the court is over 70 billion won.”


    “What? 70 billion won?”


    “Even if thepany is sold off in pieces, they wouldn’t be able to pay even half of their debt. H Chemical would even hardly receive partial payment.”


    “Hmm.”


    “The best way to resolve it for both H Group and Mulpasaneop is that someone acquires Mulpasaneop and pays off the debt in an installment n.”


    “And we are supposed to continuously supply raw materials to them?”


    “That’s right. For the overdue payment, thepany will pay in installments; however, for the new raw materials supplied, we will pay right away the following month.”


    “Hmm.”


    “I came here today to ask you to withdraw thewsuit you filed for the overdue payments because the buyer of Mulpasaneop will pay them in installments once he acquires thepany.”


    “Hmm.”


    “The potential buyer wants to hear H Group’s confirmation on it so he could make his decision to acquire thepany.”


    “I can’t withdraw thewsuit. I am an employee of H Group, and I have to show my superiors that I am making an effort to get the payments from Mulpasaneop. I think you should file an application for an objection to it. If you do so, the court will not issue a payment order for us right away.”


    “I see. Thank you.”


    “So are you saying there is someone who wants to acquire Mulpasaneop?”


    “Well, you will see some changes to Mulpasaneop in the near future. I will talk to you then.”


    Gun-Ho visited all three raw material supplierpanies and suggested them with the same deal. All of them hoped that the buyer would pay them the overdue payments in installments, and they would continuously supply the materials to Mulpasaneop. Next, Gun-Ho went to see the other creditors—the vendors. One of them was located in Yesan Town, Chungcheongnam Province.


    “Yuseung Tech? Hi, May I talk to the president? I am the managing director of Mulpasaneop.”


    “Oh, you are the new managing director of Mulpasaneop, right? I actually was going to contact you. When are you going to pay us?”


    “Are you aware that Mulpasaneop is in the court receivership process and all of the overdue payments are on hold pursuant to the court order?”


    “I know that. But we are not a bigpany, and we need that money to conduct our business.”


    “I am on my way to yourpany. I will talk to you when I get there.”


    Yuseung Tech in Chungcheongnam Province didn’t look that small. The factory was probably over 3,000 pyungrge.


    The president was waiting for Gun-Ho at the main entrance.


    He looked like a meticulous man in his 50s. His factory was very neat in its own way.


    “Ourpany barely functions without 1 billion won that was supposed to be paid by Mulpasaneop.”


    Gun-Ho told him that once the new buyer decided to acquire Mulpasaneop, they would make the overdue payments ording to an installment n.


    “How many workers do you have here?”


    “We have 90 workers. Our sales revenue is a little over 12 billion won. We currently provide our products to twopanies: Mulpasaneop and another one called Jaewon.


    When Gun-Ho worked in a factory years ago, he couldn’t even get a job in apany this big that had 90 workers. The factory that he used to work for was a smallpany with about 20 to 30 employees. Thestpany—YS Tech that he worked for was about the same size as Yuseung Tech.


    “Okay, it’s all done.”


    The meeting with the five major creditors of Mulpasaneop was sessful.


    “If I acquire Mulpasaneop, I wouldn’t have to pay their debts all at once. I can pay them in installments.”