The Mech Touch novel Chapter 977

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Chapter 977

"WHAT?!" Ves erupted . "The Ministry of Economic Development bestowed 21 percent of the LMC’s shares to the TNC Holding Group in exchange for permits and approval!?"

"Those permits aren’t worthless . " Marcella told him . "In fact, every large mech manufacturer with ambitions to sell a large volume of mechs per year needs to have the consent of the Bright Republic . Any company that doesn’t play along will be stymied by the various government institutions that issue those permits and approvals . "

"Why didn’t you tell me?"

"The LMC scaled up much faster than I anticipated . I always intended to inform you, but you were already off before I knew it . No matter . Even if you were still around, you’d surrender to the inevitable . Besides, it’s not as if they paid for your shares for nothing . That girl Calsie you put up as your representative managed to negotiate a sum of around 13 billion credits in exchange for 21 percent of your shares to the LMC . For now, that money is stored in a trust fund in your name . "

Ves blew his top off . "What kind of biased evaluation is that?! The LMC may not have been around for long, but a fifth of my company is worth a lot more than 13 billion credits in my judgement!"

"The auditors in the employ of the Ministry of Economic Development don’t think so . Are you questioning their judgement?" She sent him a deprecating smile .

Properly speaking, MinEcDev should have hired impartial auditors to determine the worth of the shares of the LMC . Yet according to Marcella, the ministry set its own rules so whatever it did was absolutely legal!

It was utter nonsense of course!

Using their own people to inspect the finances of the LMC in order to determine how much they should pay for its shares was like a kid pointing to a toy and saying that it’s worth nothing so that he could get to play with it for free!

"What a scummy ministry . " Ves muttered . "If they’re already like this at the start, I am dreading what I’ll hear next . "

They moved on to the current share structure of the LMC . Marcella summoned up a flat projection that listed the current shareholders of the LMC to this date .

VES LARKINSON: 49 percent .

LARKINSON ESTATE: 25 percent .

TNC HOLDING GROUP: 21 percent .

BOLLINGER MECH TRADE: 5 percent .

Overall, the front for the Ministry of Economic Development wrangled just enough shares out of his hands to lose absolute control over his company .

He didn’t think that was a coincidence .

"Why leave me with 49 percent?"

"If the ministry takes any more, you’d be less invested in your own company . " The mech broker explained . "Who won’t say you’ll neglect the LMC and start up a new company instead? The purpose of the MinEcDev isn’t to drive you away, but to bind you and your company to the state . Every company that has gained some influence in the economy is a tool to enhance the power and prosperity of the Republic . They don’t want this tool to fall into other people’s hands . "

Marcella briefly explained the rationale behind this policy of taking a substantial minority stake in major companies . Not only did the Bright Republic wanted to keep the company in their clutches and prevent them from transferring their headquarters to another state, they also wanted to rein in the absolute control of the founders of the company .

"The Bright Republic isn’t the exception here . " She said . "Many states have adopted similar industrial policies at the higher level . The states don’t care about startups and small businesses within their borders . However, it is critically irresponsible to let their larger companies do what they want . Companies pursue their own interests and the interests of their CEOs and shareholders . Sometimes, those interests conflict with the interests of the state . "

Ves understood the logic of the inherent solution adopted by the states . Even if he didn’t entirely agree with them in his position as a business leader, he could see why the states did not wish to be at the mercy of the whims of the companies within their borders .

"You can’t fight against the Republic on this point, Ves . " Marcella warned him . "Many have tried and failed . Free market economies are out of vogue these days . "

They moved on to the role of the TNC Holding Group . Even though only a portion of the members of the board directly represented their interests, the other members actually deferred to the TNC and in extension the Ministry of Economic Development!

As someone who took liberties with power himself, Ves knew that the Ministry of Economic Development was throwing their weight around, making it difficult for others to refuse their demands .

According to Marcella, MinEcDev wielded a substantial amount of power in shaping the Republic’s economy! Anyone who didn’t play ball with them would find their business environment constrained while the conditions of their competitors eased up . In that fashion, MinEcDev’s policy of holding only a minor say in matters within the company effectively morphed into a voice that couldn’t be ignored .

Ves glowered at the description of the infamous ministry . While he heard some things about their overbearingness in the mech industry, he didn’t think they took so many liberties and that his company would fall within their clutches so soon after he founded his company .

"It’s actually remarkable how fast they moved to acquire a stake in your company . " Marcella half-complimented him . "That means they are paying special attention to you . MinEcDev sees promise in your career prospects and remain hopeful about the LMC’s growth trajectory . To that end, they pushed aggressively to expand the Mech Nursery’s production capacity . "

"And thereby piling mountains of debt on the LMC’s balance sheet . " _{ƒreewebɳovel.com}