Restructuring Market is Coming?




Memory of Houlihan Lokey

It was more than ten years ago. I first met Houlihan Lokey during the conciliation procedure of CMA CGM ("CMA"). One of the biggest creditors of CMA was the Export-Import Bank of Korea ("KEXIM"), and I represented KEXIM with H.Y. and Christopher JoonTae. One of my highlights in Yulchon's career was working for KEXIM on CMA's conciliation procedure, a unique French procedure preventing a company from insolvency.


Thanks to Yulchon, I could be fully dedicated to this work (no fee discount) and worked almost 20 hours daily. Houlihan Lokey was the restructuring specialist for this project, and I am practically shocked by their fully dedicated service. I tried to absorb their style. While doing such, I began to go "crazy," according to my colleagues. Luckily I found pictures of my room which proves my colleagues' grim expression.


Thanks to Yulchon's only French specialist Seungmin Lee (now he is a professor), we directly translated the French court documents (homologation, etc.) into Korean.


I was proud of the first legal report analyzing French legal implications on diverse structures of KEXIM's ship financings in CMA's conciliation. I got an idea from Houlihan Lokey's daily report. Eventually, CMA recovered from the liquidity issue.


Again thanks to this experience, while Yulchon sponsored scholarship (Ph.D.) period, I could write an article about shipping finance and insolvency, excluding French conciliation, which I kept as a whole separate subject.


Collective Knowledge

Houlihan Lokey showed me a new way to combine every possible area, integration, and collective arts. As a result, I began to connect the different areas of work at Macquarie as in-house legal. It encompasses not only finance but insurance, valuation, business, tax, risk assessment, etc.

春秋 (Lüshi Chunqiu)

Chinese first collective knowledge, encyclopedic Chinese classic text compiled around BC 239. It was the Chinese version of Wikipedia 2,261 years ago. It's like open-source software that everyone could add value to. According to 司馬遷(Sima Qian), 呂氏春秋 was hanged in the gateway of the Qin dynasty, and Lü Buwei gave a prize to anyone who could add or delete at least one Chinese Character.


Specialization vs. Integration

A law firm is a specialized service provider; a restructuring specialist like Houlihan Lokey is an integration service provider which contains a holistic analysis that considers all possible areas. Thus inevitably expensive. My eyes popped up when I saw their numbers. Can a Korean company provide such a service? I was doubtful ten years ago. Now I see some possibilities looking for MZ generation.


Restructuring Market

The world is changing, and someone said, "the Winter is Coming." I thought that Houlihan Lokey's 'revenues in financial restructuring' could be a sign, and found it correct. The winter is coming. As a balloon effect, FY23's 'corporate fiance revenues' will decrease, and 'financial restructuring revenue' will increase, in my view, significantly. So we need to prepare for the winter.



An Excerpt of Conversation (includes informal expression)

D. K.: Hey Doc, any view on this article?

Ph.D.: D. K. didn't I mention that stop guessing and finish your "Speak up, Shut up" series?

D. K.: You are not answering my question. Your answer is not logical.

Ph.D.: Nice try. But your conclusion is just based on Houlihan's presentation only. All others are just boasting about your experience, which lacks relevance. I call this kind of article a "Speculation."

D. K.: (nodding) Wow, what a great comment. You deserve to be my friend. So I will give you a 號 (nickname), 喩彬 (Youbin). It means you are shining with wisdom through your logical mind. How about that?

Ph.D.: I like the meaning, but the emotion of "like" may distract my logic. Thus I need to think logically when I empty such feelings.

D. K.: Shut up, and call me Kim Daoshi (Tao Master).


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