Chapter 397: The New Order Under the Gavel

Chapter 397 -42: The New Order Under the Gavel

In mid-August, the Trust Agency held its first auction.

The venue was a grand, magnificently decorated hotel in East Berlin.

The first company to be auctioned was the Leipzig Precision Machinery Plant.

The plant produced machine tools and precision instruments. It had been a star enterprise in the East Germany era, but now it was heavily in debt and on the verge of bankruptcy.

Starting price: 5 million West German Marks.

The auctioneer, a West German man in a tailcoat, held up a small gavel and announced, “Ladies and gentlemen, the bidding for the Leipzig Precision Machinery Plant will now begin. The starting bid is five million West German Marks.”

“Six million,” a West German businessman bid, raising his paddle.

“Seven million,” another bid.

“Eight million.”

“Nine million.”

The price quickly rose to 12 million.

Werner sat in the back row, watching quietly. He didn’t raise his paddle.

The bidding stalled at 15 million. Only two buyers remained in the running: a representative from Siemens and a West German investment firm.

“Fifteen million, going once…”

“Fifteen million, going twice…”

Just as the auctioneer was about to bring down the gavel, Werner raised his paddle.

“Sixteen million.”

All eyes in the room turned to him.

The Siemens representative frowned, then raised his paddle. “Seventeen million.”

Werner didn’t hesitate. “Eighteen million.”

“Nineteen million.”

“Twenty million.”

The price soared, quickly reaching 25 million.

The Siemens representative looked at Werner, his eyes filled with suspicion. ‘Where did this East German get so much money?’

He raised his paddle again. “Twenty-six million.”

Werner smiled, shook his head, and did not bid again.

“Twenty-six million, going once… Twenty-six million, going twice… Sold, for twenty-six million!”

The auctioneer’s gavel fell.

The Siemens representative breathed a sigh of relief, but he watched Werner with a wary gaze.

Werner stood up and walked out of the conference room.

At the door, Hans Mueller caught up to him. “Werner, why did you give up?”

“Because that plant isn’t worth twenty-six million,” Werner said. “Siemens overpaid by a long shot.”

“But you bid all the way up to twenty-five million. Didn’t you want it just as badly?”

Werner laughed. “Hans, I was bidding to drive up the price. Making Siemens spend more is good for the Trust Agency, and it’s good for me.”

“How is it good for you?”

“Because Siemens wasted their money, they’ll be more cautious at the next auction,” Werner said. “And I can take the opportunity to acquire a company that’s actually valuable.”

Hans was stunned.

Werner patted his shoulder. “Hans, when’s the next auction?”

“Next week,” Hans said. “The Jena Optical Instrument Plant is up for auction.”

“Excellent,” Werner said. “That’s the one I really want.”

***************

A week later, it was time for another auction.

The Jena Optical Instrument Plant. Starting price: 3 million West German Marks.

The price was much lower than that of the Leipzig Precision Machinery Plant because, on paper, this company had heavier debts, older equipment, and worse prospects.

But Werner knew this plant held a treasure: a top-tier optical technology team and several unique patents.

The auction began.

“The bidding starts at three million West German Marks.”

“Three and a half million,” a buyer bid, raising their paddle.

“Four million,” another bid.

The price quickly rose to six million.

Then, it stalled.

Most of the West German buyers weren’t interested in this plant. They felt its debts were too high, and there wasn’t much profit to be made.

Werner raised his paddle. “Seven million.”

The auctioneer looked at him. “Seven million. Are there any other bids?”

No one raised their paddle.

“Seven million, going once…”

“Seven million, going twice…”

“Seven million, going three times… sold!”

Werner had won the Jena Optical Instrument Plant.

************

Over the next month, Werner acquired two more companies:

The Dresden Semiconductor Plant, for 8 million West German Marks.

The land of the Halle Fertilizer Plant, for 6 million West German Marks (he didn’t want the factory itself, only the land).

Each time, Werner used a similar strategy:

First, he obtained information in advance. He knew which companies would be auctioned, their starting prices, and who the competition was.

Then, he would interfere with the valuation. He would “suggest” that the Trust Agency undervalue certain companies, always providing sound reasons—”This plant is too heavily in debt,” or “That one’s technology is obsolete.”

Next, he leveraged “political correctness.” Before each auction, a few dissidents or Church members would speak up in the Trust Agency’s meetings, saying, “We would be very supportive if Mr. Werner Betelich were to acquire this company. He is a local East German entrepreneur, and a man of conscience.”

Finally, he would “cooperate” with the West German buyers. Sometimes, Werner would deliberately drive up the prices of certain companies, making the West Germans overpay. Then, at the next auction, those buyers would be more cautious, leaving an opening for Werner.

By early September, Werner had acquired five companies, spending a total of 35 million West German Marks.

His funds came from several places: some from arbitrage during the monetary union, some from a loan from a West German Bank (collateralized by his overseas assets), and some from… less-than-reputable channels.

But regardless, he had succeeded.

**************

Mid-September, in Werner’s office.

His secretary walked in and placed a file on his desk. “Boss, here is the latest report on the five companies.”

Werner opened the file and read it carefully.

Jena Optical Instrument Plant: The technical team has been stabilized and is now in talks for a partnership with Carl Zeiss of West Germany.

Dresden Semiconductor Plant: Has begun to accept some OEM orders from West Germany. The profit margins are low, but it’s enough to keep the plant running.

The land from the Halle Fertilizer Plant: Cleanup is complete. It is ready to be sold to a West German real estate company, with an expected profit of three million.

Werner put down the file and lit a cigar.

The secretary asked, “Boss, what’s our next move?”

“We continue,” Werner said. “The Trust Agency still has thousands of companies to sell. We have plenty of opportunities.”

“But, Boss,” the secretary said, a little worried, “I heard that some people are keeping an eye on you.”

“Who?”

“Some West German businessmen, and some officials from the Trust Agency,” the secretary said. “They suspect you’re using inside information to manipulate the auctions.”

Werner laughed. “Suspicions are just suspicions. Do they have any proof?”

“No,” the secretary said. “But…”

“If there’s no proof, there’s nothing to worry about,” Werner said. “The easiest time to make money is during the fall and reconstruction of a nation. Opportunities like this are fleeting; you can’t hesitate.”

He stood up and walked to the window, looking out over East Berlin.

The streets were filled with construction sites. The old was being demolished, and the new was being built. West German businessmen, workers, and technicians were flooding into the city, redefining it with West German Marks and West German rules.

“Go and prepare for next week’s auction. I heard a chemical plant in Jena is going on the block. Investigate it and see if it’s worth anything.”

“Yes, Boss.”

The secretary left.

Werner sat back down in his chair, his eyes on the list of companies on his desk.

He knew this was only the beginning.

The Trust Agency’s privatization process would last for several years. During that time, countless companies would be sold, and immense fortunes would be redistributed.

Some would make a fortune at this feast, some would go bankrupt, and some would kill themselves.

And Werner intended to be one of the ones who made a fortune.