A Returner’s Successful Investment Method - Chapter 644



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Episode 644 malay scandal (5)

Currently, the world is waging a war over semiconductor supremacy.

In the design field, prominent companies such as Enple, Gubble, ADM, Antel, and Mvidia competed, and each country competed to attract semiconductor factories to their country.

Among many semiconductor production companies, there are only two in the world that are currently capable of microprocessing below 7 nanometers.

They are Yusung Electronics and PSMC.

Unlike PSMC, a specialized foundry company, Yusung Electronics is a company that originally specialized in producing and designing memory semiconductors.

However, the importance of system semiconductors is currently growing globally.

Accordingly, Yusung Electronics advanced into the field of system semiconductor design and foundry.

Although it experienced many difficulties in the beginning, the acquisition of NP Semi and RD Quarnet and ADM equity investment were a great success, giving it design capabilities and rapidly catching up with PSMC in the foundry field.

By acquiring Dongwoo Precision and applying the NIL method to microprocesses of 7 nanometers or less for the first time in the world, we secured price competitiveness and also resolved the bottleneck caused by the lack of EUV equipment.

The President of Taiwan even expressed caution by saying, ‘Yuseong Electronics is the biggest threat to Taiwan’s economy.’

Another growth engine for Yusung Electronics is the data center.

Experts predicted that the data center business, which was started in collaboration with Snow Crash, will become a source of growth for Yusung Electronics in the future.

As the status of Yusung Electronics is growing, Chairman Yoo Jae-ho has also become busy.

Leaders of each country invited Chairman Yoo Jae-ho and asked him to invest in semiconductor factories in their countries.

On his way back from a business trip to Germany, Chairman Yoo Jae-ho received a call from Hanmiru.

[hello.]

Chairman Yoo Jae-ho spoke in a happy voice.

“hello?”

[How are you?]

“of course. “I am returning from a business trip to Germany.”

[ah! I saw the article. An automotive semiconductor agreement was signed with BMW and Volkswagen Group. Congratulations.]

“Haha, thank you. How are you doing?”

[I am also working hard these days. It may not be as good as the Chairman.]

Chairman Yoo Jae-ho smiled at those words.

There is no wind on a tree with many branches, but when you become the chairman of a conglomerate, you are very busy.

On the other hand, Miru Han puts David Lockhart in the forefront and only moves behind the scenes when making investment decisions.

‘Isn’t he probably the person in the world who earns the most money per working hour?’

Chairman Yoo Jae-ho thought so and said.

“I heard you went to America.”

[yes. Currently in the United States.]

Chairman Yoo Jae-ho always paid attention to Han Mi-ru’s actions.

Because you never know when something will happen.

“Are you still in LA?”

[no. I came to New York a few days ago.]

“I heard you moved to a new headquarters. What do you think?”

[I like it. Please come visit us later.]

“haha! “Just call me and I’ll be there anytime.”

After chatting lightly.

Han Miru quietly brought up the story.

[Yusung Group is investing a lot in Malaysia, right?]

“That’s right. In particular, Yusung Electronics and Yusung SB are making large investments.”

This was closely related to changes in the international situation.

At one time, China was the most important production and consumption center for Yusung Electronics.

However, in the meantime, labor costs in China rose significantly, and as Chinese companies grew, Yusung Electronics’ home appliances and smartphones were gradually pushed out.

Nevertheless, China is still a major market, accounting for 25 percent of Yusung Electronics’ semiconductor sales.

The problem is the conflict between the US and China.

Due to the power struggle between the two superpowers, Yusung Electronics was greatly affected by its exports and investments.

Due to U.S. regulations, all planned new factory construction and investment in China has been halted.

Of course, Yoosung Group was also looking for a production and consumption market that could replace China in preparation for this situation.

Southeast Asia is a place that has emerged as an alternative.

It is geographically close to Korea, and labor costs are lower than in China.

In the beginning, factories were mainly built in Vietnam, but as seen in the case of China, being too dependent on one country is dangerous.

For this reason, it has recently been significantly increasing its investment in Malaysia.

[What is Malaysia like for doing business?]

“It is a country with great growth potential. “Compared to other Southeast Asian countries, the level of public education is high and it is politically stable.”

[Is the government providing various supports to attract overseas companies?]

“That’s right. “We are providing land, tax benefits, etc.”

[So, is Yuseong Group quite close to the current Malaysian government?]

It’s a pretty sensitive question.

If someone else had asked a similar question, I would have avoided answering and tried to understand the other person’s intention.

However, Chairman Yoo Jae-ho responded right away.

“yes. “In underdeveloped or developing countries, the government’s influence is strong.”

Politics and economics are inseparable.

The rise and fall of an industry is bound to depend on government policies.

And this impact is even greater in underdeveloped countries. Therefore, when investing in these areas, it is essential to maintain a good relationship with the government of that country.

Even during the THAAD incident, the Chinese government did not grant licenses just because there was a single letter wrong in the documents, or temporarily closed factories or suspended retail stores due to violations of fire and hygiene laws, etc.

Many people know that the Chinese government at the time issued the Hanhan Ordinance imposing sanctions on Korea, but… … In fact, the Chinese government has never officially imposed any sanctions.

Nevertheless, this happened.

At that time, Yuseong Group also suffered great damage, which became an important opportunity to defect from China.

[Then there are probably a lot of things that are intertwined with politicians and key government figures.]

“If you want to make something work, it’s inevitable that you’ll need to grease it.”

In modern times where information has developed, the practice of giving direct bribes as in the past has largely disappeared. Instead, the method became increasingly sophisticated.

This can be done by hiring the family members of influential politicians, volunteering to provide scholarships to their children, or providing deals to companies created under the politician’s borrowed name.

Even in Korea, large corporations hire people who are likely to enter politics later or who have temporarily quit politics as outside directors or advisors and pay them hundreds of millions of won in annual salary without asking them to do any special work.

This is to enjoy benefits when one of them runs for election or holds a key government position.

This time, Chairman Yoo Jae-ho asked.

“You seem very interested in Malaysia.”

[Investors are likely to be interested in any region.]

‘Are you trying to invest in Malaysia?’

While I was thinking that, Han Miru brought up something unexpected.

[It would be better to sort out the parts related to the current administration as quickly as possible.]

“… … .”

It was so unexpected that I was a little embarrassed.

Chairman Yoo Jae-ho intuitively realized that this was usually not a big deal.

“How long?”

[The faster the better.]

I was wondering if I should ask the reason, but Han Miru spoke first.

[Prime Minister Binti Lime will lose the general election.]

Chairman Yoo Jae-ho swallowed his surprise and spoke as calmly as possible.

“All right. thank you for telling me.”

[What. I will contact you again when I return to Korea.]

“yes.”

When the call ended, Chairman Yoo Jae-ho put down his cell phone.

Binti Lime led the country stably during his time in power, and the economic growth rate was also good.

He promoted the fact that overseas corporate investment and employment increased significantly during his tenure. A representative example is Yuseong Group.

In this general election, the ruling party’s landslide victory was certain, and Yuseong Group continued to line up.

however… … .

‘Prime Minister Binti Lime will lose the election?’

There is no chance of the approval rating suddenly turning over now.

‘So does that mean something big will happen before the election?’

How likely is it that an incident that no one knows about will suddenly occur right before the election?

“Are you trying to do things yourself?”

We don’t know what’s going on, but it’s clear that they’re trying to do something that will cause great harm to Prime Minister Binti Lime and the ruling party.

If there is a sudden change in government, all previously established investment plans in Malaysia may have to be redrawn.

If someone else had said this, I wouldn’t have paid much attention.

Or maybe they completely ignored it.

However, the person who said this was none other than Han Miru.

One good thing is that I got the information in advance.

Thanks to this, you will be able to move before something happens.

Chairman Yoo Jae-ho immediately contacted the Malaysian representatives of affiliates, including Yoosung Electronics and Yoosung SB.

* * *

David thoroughly researched and analyzed Ming Liu and 1IDB.

1IDB is a state-owned investment company established by the Malaysian government for overseas investment.

The structure and form can be seen as similar to an SPC (special purpose corporation).

Because it is closed, it has the advantage of being able to make decisions quickly and independently, but it also has the disadvantage of weak monitoring and checks.

1IDB issued a large amount of bonds to raise investment funds and sold them to pension funds and institutional investors.

1IDB bonds had a credit rating similar to that of Malaysian government bonds, but had a higher interest rate. Therefore, it sold out quickly.

‘Did Ming Liu lead this bond issuance process?’

In fact, it was confirmed that Ming Liu personally met with current and former Richman Sachs employees and lobbied and entertained them.

If you’ve heard this far, you may not feel that it’s that strange.

However, Ming Liu was merely an external advisor to 1IDB and did not hold any position that would allow him to be involved in decision-making.

Nevertheless, he handled this important matter.

‘Are you saying Ming Liu is the Key Man?’

When Ming Liu’s name first became known in the financial industry, David didn’t pay much attention to him.

However, the more I investigated, the more strange things I found.

Ming Liu was a celebrity in Hollywood society.

The reason is because money was spent like water.

He introduced himself as a capable investor and from one of Asia’s wealthiest families. Therefore, no one questioned his spending money.

What if the money that Ming Liu has been spending so far is not his own money or his family’s assets, but 1IDB’s funds?

‘How many politicians and financiers are involved in this case?’

It is an incident that intertwines Malaysian political relations and the financial world of the United States, Hong Kong, and Singapore. Plus, to Hollywood.

I couldn’t even imagine what kind of impact this incident would have.

‘How on earth did the boss find out about this?’

It is not that difficult to know that there is a problem, investigate it, and find it.

The really difficult thing is to first realize that there is a problem.

But Han Miru did it very easily.

David stuck his tongue out.

“Do you really have the ability to spot fraudsters?”