The Greatest Conglomerate Ever With the American Lottery

22. Failure is not an option (Failure is not an option).

The deal to acquire Mubadala’s shares was finalized the next day, after the market closed on September 25.

I was now AMD’s largest shareholder.

“Are you sure you’re okay, the rumors around here are not very good?”

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Jeffrey, our lawyer, asked me anxiously as we walked out of the deal.

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Jeffrey knew.

He knows AMD is a company waiting to be nailed.

“No Risk, No Gain!”

“Dude, what’s the risk? Are you sure about this?”

“It’s all in my head, don’t worry too much.”

Though it was the beads that did the thinking.

“John said you pushed him into it.”

“John said that?”

“He called me about two days ago, asking for legal advice, and he was pouting.”

“hahahaha! It’s different now, isn’t it? Didn’t you see the look on his face?”

“Come to think of it, he was pretty animated. How did you manage to bake it in two days?”

“Well, she was vehemently against it at first, but then she realized she’d done some research and met with the head of AMD.”

“Lisa Sue?”

“Yeah, you know her?”

“You’d be a spy if you didn’t know her. She’s been the talk of the town in California investment circles since she joined AMD three years ago.”

“Really?”

“I don’t think the public knew her until she took over as president last year, but she’s a classic genius. I’ve seen her before, at a party or something, and she was very well dressed and very impressive. The consensus is that she’s the reason AMD has survived the last few years.”

That’s quite a compliment coming from Jeffrey, who is a bit of a polemicist by nature.

Does a genius recognize a genius?

Hey, Jeffrey. You’re no slouch yourself, are you?

“Anyway, AMD is going to come back to life, so you’ll see. Even John, who was so against it, did a complete 180 once he met Lisa Sue.”

“Well, he’s certainly capable, so that’s one thing, but if you ask me, I’d recommend stopping there. I don’t want him to go all the way to the top.”

“Hmmm—.”

“You’re right, if you want to eat big, you have to take risks, but AMD is too risky to plunk down more than 30% of your fortune. Especially with Jim Keller on the way out.”

“I heard from John that Jim Keller is leaving when his contract expires, but is he really that great?”

“Didn’t you just call Dr. Sue a genius?”

“Yeah.”

“Well, I’d say he’s several times that. I don’t know much about him, but they call him the father of the multi-core processor. AMD’s next big thing is supposed to be his creation.”

“…”

What kind of geniuses are there so many?

Would a genius like me live in shame?

“It’s even been said that the reason AMD’s stock price has had a one-run ERA since the summer is because he’s leaving. AMD insists that he’s done his job.”

“Well, I’m meeting with Dr. Lisa Sue tomorrow, so I’ll talk to her then.”

“You’re meeting with Dr. Sue?”

“Of course I do. I’m investing a lot of money, and I need to see the face of the person who made me do it. We’re having lunch tomorrow, so I’ll call you as soon as I’m done.”

“Sure. I’d love to join you, but I have a golf outing with a tycoon tomorrow.”

“hahahaha! Okay.”

The next day, even though it was a Saturday, I left the house before 10 a.m. to meet with Lisa Sue.

AMD is headquartered in Santa Clara, which is south of San Francisco.

Obviously, since it was Lisa Sue, she should be coming this way, but I wanted to see the company, so I suggested we go.

And then I regretted it immensely.

“What, how many miles?”

“It’s about 350 miles from here to Santa Clara.”

“If it’s 350 miles, how many kilometers?”

“It’s probably over 560 kilometers.”

“What’s so far away, I thought it was right next door because you sounded like you were saying next door?”

“In the United States, it’s the next door neighbor, boss.”

“…”

Great America.

560 kilometers next door?

Seoul to Busan is 400 kilometers?

“Well, does that mean I have to drive there? It’ll take like six hours?”

“hahahahaha, that’s not possible. Normally I would drive, but you’re a super rich guy, right? No, not necessarily rich, but most of the time when I travel for business, I fly. I suppose it makes a difference which airplane you fly on.”

“Phew, good to know.”

And so I boarded a chartered plane and arrived at the airfield near Santa Clara, where AMD had a limousine waiting for me.

I was already a major shareholder in AMD as of yesterday, prior to today’s deal, so they were concerned.

A short time later, I arrived at AMD’s headquarters on Augustine Drive in Santa Clara and was given a pre-requested tour of the headquarters.

A surprisingly large number of employees showed up for work, even though it was a weekend, and I saw hope in their faces, which was surprisingly upbeat for a company that is dying.

It was reassuring to see that they seemed confident that while times were certainly tough, the company would come back to life in the not-too-distant future.

“Welcome, Mr. Smith”

We were ushered into the main office, where we were greeted by an Asian woman with a very shabby appearance.

She’s unexpectedly tall, but her lips are pressed into a tight smile.

“hahahaha, we see each other every few days, Dr. Sue. Say hello, this is Alex Kang, the CEO of Karma Investments.”

“Thank you for coming to save our company, Mr. Kang.”

“It’s a pleasure, I’ve heard so much about you, President—.”

“Excuse me, boss, it’s Dr. Doctor.”

I was about to call him President, but John whispered in my ear to call him Doctor.

Huh? Doctor?

“Ah, Dr. Sue. Nice to meet you.”

Couldn’t he have given me a heads up?

I’d been told that Americans consider a doctorate a great honor and want to be called that, but apparently Lisa Sue was no different.

Doctor in Korea?

It’s like a doctorate on top of a master’s?

“Ho-ho-ho! You can call me whatever you want, but I like to be called Dr.”

“hahahaha! Okay, Dr. Sue.”

“If your last name is Kang, are you of Korean descent?”

“Yes, that’s right. Not exactly Korean, but Korean-American.”

“Ah! I see.”

“Dr. Su, I thought you were of Taiwanese descent?”

“She was born in Taiwan, but she doesn’t have any memories of Taiwan. She immigrated to the United States when she was three years old.”

“Aha, I see.”

Does he just want me to see him as an American?

I don’t care.

We chatted for a while about our impressions of the company, and then we went to eat.

“How did you like your meal?”

“Well, it was okay.”

“Well, you look like you didn’t like it, but I’m actually new to this restaurant.”

“What?”

“I’m not usually in California, I’m at the Austin lab in Texas.”

“Oh!”

The CEO isn’t at the headquarters, she’s stuck in the lab?

Strange for Korea, but this seemed like the kind of woman she was.

“Dr. Sue, I hear Jim Keller is leaving, so what’s going on, and is this going to stop you from developing the next generation of products?”

“Well, there’s a lot of talk about Jim leaving, but I can assure you that he’s doing what he needs to do, and it has absolutely nothing to do with the launch of the new product.”

“Really?”

And then her rant began.

“I don’t see the future in mobile devices, I see the future in the data that’s pouring out of the thousands, or tens of thousands, or hundreds of millions of devices.”

“Oh!”

“We don’t have the ability to tap into that massive amount of data yet, because we don’t have the computing power to process it at high performance.”

“I see!”

“Eventually, we’ll need servers to process the data, and the heart of a server is the CPU, so I’ve bet the company’s fate on developing the most powerful CPU in the world.”

“Fantastic! Brilliant!”

There was something about this woman that made you fall in love with her.

Incredible talent and passion for technology.

I could see why John had become a fan of Lisa Sue after one look.

“Dr. Sue, I have one last question for you.”

“Yes, please feel free to ask.”

“Are you confident that you won’t fail?”

“I’ll answer that with what I always say: Failure is not an option for us.”

“Great, great, great! Raise the capital, we’ll do it!”

“Thank you, Mr. Kang, you won’t regret it.”

After shaking hands with the beaming woman, I asked again.

“By the way, Dr. Sue. Do you see any obstacles to doing a capital increase? I’m guessing there might be some pushback from existing shareholders?”

“No. It’s a capital increase that pumps a ventilator into a dying company.

Plus, it’s a third-party allotment, which means that AMD, a sh*tty stock anyway, will be worth even less per share and its stock price will plummet.

“While it’s true that as president and CEO, I have a responsibility to support the stock price, this is a do-or-die situation for AMD. I don’t care about the shareholders who will cry and laugh over the stock price on a daily basis. If they can’t hold it together and go down, that’s their choice, and they’ll regret it terribly later.”

“hahahahaha! I’d love to see them regret it.”

“Ho-ho-ho, they will.”

We ended the meeting by agreeing in principle to raise the capital as soon as possible, but leaving the practicalities to be negotiated from Monday.

And so, on Monday, with John leading the charge and Jeffrey supporting, the negotiations began.

We were asking for $0.7 per share because we were investing in a failing company, and AMD said that was unacceptable and insisted that it should be $1.4 per share.

We were told that it was common practice to use the stock price three or five days prior to the IPO date, but we couldn’t use that formula for an investment that was essentially a gamble.

Meanwhile, the closing price on Monday, September 28, dropped further to $1.66.

Eventually, Lisa Sue stepped in and agreed to acquire the company at $1.

This is the price we were aiming for in the first place.

We issued 150 million shares at $1, which brought our stake to nearly 30%.

From nob le mt l. co m

John said that this was due to the overnight dilution of our per-share ownership in the stock offering.

This brings our total investment in AMD to $292 million.

There’s still $58 million left on the additional $350 million John and I have committed.

“Should we spend that $58 million on something else?”

“Boss, that’s not it, is it?”

“Huh? Then what?”

“The capital increase was announced after the market close on Friday, so Monday will be all hell breaking loose. You can write then.”

“Ohhh!!!”

Or is it different?

When the news of the capital increase from an unnamed investment firm broke, AMD’s stock price plummeted.

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John deftly picked it up.

Friday evening, at the end of a hellish week.

“All $58 million gone, boss.”

“Oh! What happened?”

“They were purchased at an average price of $0.65 per share, so the additional stake is 8.5%! Congratulations, boss, you’re now a 38% majority shareholder in AMD, making you the de facto owner of AMD!”

“hahahahaha!”

“hahahahaha!”

Now all we have to do is wait.