“Rejected the acquisition?”
Teslan headquarters, Austin, Texas.
CEO Mustin folded his arms, his expression displeased.
“Hmm... Strange. Very strange.”
He looked at ARG’s Speed2 standing on the table.
It was astonishing. The production cost of this sturdy workhorse was only seventy thousand dollars. In truth, Teslan, the frontrunner in the robotics industry, had plenty of robots with better technology than this one, but all of them had failed to overcome the barrier of unit cost.
And then, at just such a time, a startup that could compensate for their lacking technology had appeared like a comet. How could it not catch their eye?
After reviewing everything about Speed2, from its durability to its autonomous control, Teslan’s technical team reached a conclusion: they had to secure this company.
“James, what’s the reason? Twenty million dollars shouldn’t be a small sum for a startup.”
“With all due respect... a shit fly has gotten involved.”
“A shit fly?”
“Asan Enterprise of Korea. In fact, the MOU discussions had originally been going quite well, but ARG’s attitude began to change after they met with people from that side.”
James, the attorney leading the acquisition, explained in detail what had happened.
ARG, which had been perfectly compliant, had grown endlessly arrogant after Asan Enterprise appeared.
“But I believe it will be wrapped up without any major problems. Within this month at the latest.”
“A competitor that didn’t exist before has appeared. How can you assert that?”
“Sir, to be honest, calling them a competitor is far too generous.”
James laughed as if it were not even worth discussing.
“Asan? They’re good, yes. Fourth in U.S. market share, third in global market share. But do you know Asan Enterprise’s market cap? It isn’t even five percent of Teslan’s.”
The global figures currently being recorded were meaningless numbers. Looking only at automobile market share, Teslan ranked far below them, yet its market cap was over twenty times Asan’s. Investors around the world all predicted that Teslan would seize hegemony over the next generation of automobiles.
“Even if we assess it coldly, in every aspect—funding, technology, outlook—Teslan is dozens of times ahead of them.”
“Then why did ARG reject our MOU? It’s annoying.”
“Isn’t it obvious? They’re trying to raise their price.”
At James’s words, all the executives nodded.
“They want a higher acquisition price?”
“Yes. They’ll try to raise their valuation somehow by weighing that side against ours. But there’s nothing to worry about. Our market cap is over twenty times Asan’s. As if we couldn’t put up a little acquisition money. The assets we can mobilize are probably twenty times greater as well.”
No sooner had James finished speaking than the CTO spoke up.
-Sir, I agree with Counsel James as well. If the acquisition price is the problem, we can simply match whatever valuation Asan offers. If the price is the same, it’s obvious who ARG will choose.
-With all due respect, sir, I wonder if there’s any need to match the price at all. Why should we, the overwhelming number one in robotics, match the valuation of Asan, whose robotics technology isn’t even in the top ten?
-That’s right. If ARG is merged into Teslan, its model can be integrated immediately. I don’t think there’s any need to go that far for a single startup.
It was only a matter of time.
The usual bravado that came up during mergers and acquisitions. In the end, it was merely for raising the price, but ultimately, the merger would proceed according to the natural order. Was there any fool in this world who would reject a merger offer from Teslan?
“How troublesome. I thought twenty million dollars was already generous, but they want more?”
Mustin, famous for his authoritarian personality, frowned with clear displeasure.
But he decided to think rationally. ARG’s innovation in unit cost was the one technology Teslan had yet to attain. If Teslan’s robotics became inexpensive on top of everything else, it would be like a tiger gaining wings.
Within a dozen years, laborers might disappear altogether.
“Fine, then. To Sharma, that money will be his retirement fund, so we should give him a handsome amount.”
-Since you brought him up, sir, what do you plan to do with ARG after the acquisition...?
“Teslan’s internal rules are the same for everyone. If you’re capable, prove it. But if you can’t prove it? Then you leave. No matter who you are.”
Even within the cutthroat world of Silicon Valley, Mustin was infamous as a strict meritocrat.
When he acquired a company, he began with brutal restructuring and cut unnecessary labor costs. It would likely be the same for ARG. Those who were needed would be kept by his side, but those who were not would receive a call from HR the moment the merger went through.
“But these principles of mine don’t apply only to ARG. You know what I mean, don’t you?”
This time, the executives turned pale.
It sounded like a threat that if they mishandled this matter, the people sitting here would lose their jobs as well.
“I’ll say it again. You have until the Automate Expo. We need to draw up a binding contract with ARG before then. The Automate Expo should effectively become our technology demonstration.”
“Y-yes, sir.”
“One month left. Let’s see what our executives are capable of.”
As Mustin rose from his seat, Attorney James hurriedly asked,
“Sir, what should we set as the ceiling for the acquisition price?”
Mustin looked at the executives and said,
“I quite like the executives’ opinions. We are the world’s greatest robotics company. Is there really any need for us to match the terms of a midsized company called Asan? And it’s slightly offensive that ARG is trying to raise its valuation by weighing both sides.”
“T-that is true.”
“In my view, Sharma has already made his decision. He only wants to receive even one dollar more. Don’t let yourselves get dragged around too much. Teslan is the greatest company on Earth.”
After he disappeared, James sighed and grumbled.
“Damn it... He sets the time deadline but tells us to decide the acquisition price ceiling ourselves. That eccentric bastard.”
*
“I apologize. I normally never break appointments, but the Automate Expo is just around the corner.”
“It’s all right. I’m grateful enough that you made time for me despite your schedule.”
One week later.
I finally managed to have a one-on-one meeting with CEO Sharma.
Short and simple-faced, he welcomed me with an easy, affable smile, but I could not relax in the slightest.
I couldn’t be fooled by that good-natured face.
The man I knew was a union-killer, someone who went around coaxing every company back when robotics was being commercialized. Thanks to him, the already scarce manufacturing jobs were shattered, and a twenty-first-century Luddite movement unfolded. But he left only one very cynical remark for the protesters.
Why oppose this machine when you use washing machines and vacuum cleaners just fine?
“Sir, before we begin talking, I’d like to present our proposal first.”
On top of that, Teslan and we were currently in an acquisition competition.
The reason he had been late today was probably not the expo, but a meeting with Teslan’s people. I could hear the abacus beads clicking in his head as vividly as if they were right beside my ear.
When I handed him the documents, his eyebrow twitched.
“What is this?”
“It is the acquisition proposal that Asan Group and Korea NPS have in mind. Please review it.”
“Wait a moment, Mr. Lee... I appreciate you coming all this way, but we already have a party we’re in talks with.”
“Teslan?”
“Yes. No matter how you look at it, shouldn’t the robotics industry go to Teslan? To be honest, what matters to me isn’t simply selling my technology for a high price, but seeing the technology I created applied and integrated. As an engineer, I’m not someone greedy for money.”
What a load of crap. He had postponed the MOU with Teslan as soon as Asan and NPS started hovering around.
The claim that he had no greed for money was also a lie. The Sharma I knew was the man who had been at the forefront of selling automated process systems to corporations as soon as robotics was commercialized.
Just as Envidi was currently doing credit-ledger deals with GPT, he too lent money to companies, installed process systems for them, and collected the money later.
All of that was aggressive marketing built on the enormous financial power that came from Teslan.
“I’ll say it again, I am an engineer. I don’t have even the slightest greed for money.”
I smiled bitterly.
Seeing him come out so firmly, it seemed he wanted to use us as a tool. By straddling both Asan and Teslan, he intended to use us as leverage to raise his own valuation.
“But you can at least hear the proposal, can’t you? There’s nothing bad about listening.”
“I feel bad, that’s why. The answer I can give you won’t change anyway.”
“If you feel that bad, then please at least review it once. If you reject us after reviewing it, I think I’ll feel a little less wronged. Haha.”
Reluctantly, he picked up a pen and turned his gaze to the documents.
Then, before long, he began marking various places and asking me questions.
“So this means you’ll guarantee management rights?”
“Yes. We will support you, but we will not interfere. No matter what company ARG is acquired by, please remain in your position as you are now and focus on research and development.”
“Large corporations are always kind like that only before an acquisition.”
“If you wish, we will attach effective conditions as well.”
“Effective conditions?”
“Please transfer to us not fifty percent plus one share, but fifty percent minus one share.”
“I’m sorry, but I’ve never heard of an acquisition like that.”
“That is why it is preferential treatment. Even if the acquisition takes place, all decision-making authority will remain with you.”
Sharma stared quietly at me.
The difference of those two shares was truly enormous. After all, it was a question of who held the majority stake.
“Please look at the section below as well. We fully understand your ambitions as an engineer. Whether the technology one created can be immediately applied and integrated into industrial sites is an extremely important issue.”
“Ahem, yes.”
“Therefore, as soon as the overall technical review is complete, we will integrate this model and install the processes. As you know, Asan Motors ranks third in global market share, and we have no shortage of factories where we would like to introduce automated processes.”
“Well, that isn’t bad.”
“There is more below that. The technological patents held independently by ARG will not be misappropriated by the parent company. And when they are used by affiliates other than Asan Motors, fair royalties will be paid. Naturally, those profits should go to ARG’s executives and to you.”
“...You’ll guarantee the patents too? And this broadly?”
“That’s correct. We will guarantee all of it.”
When three hours of persuasion came to an end, I was out of breath.
I had given it everything I had. At this point, I had done everything I could.
Maintaining his position as CEO, giving up majority control to guarantee management rights, guaranteeing royalties... I had guaranteed every condition he could never dream of receiving if he went to Teslan.
Sharma’s eyes were already filled with conflict. Would Teslan really give him guarantees like these? His eyes showed that he already knew such a thing was out of the question.
“Good, good. But you see, no matter how much of an engineer I am and how little greed I have for money, this seems a bit off.”
He showed me the document.
“So you haven’t written the terms for this, the acquisition price. In some ways, this seems like the most important part, but only this section is blank. If you do this, then from our position...”
“You can write that in yourself.”
“Pardon?”
“It’s a blank check. How much will it take?”
At that single sentence, Sharma, who had maintained an overbearing attitude until now, slowly unfolded his arms.