高丽亚铅控制权争夺延续至9月临时股东会，短线更像旧闻发酵而非新增交易催化

Two years after Young Poong and private equity firm MBK Partners launched a hostile takeover bid for Korea Zinc (010130), the two sides remain locked in litigation and a fight for board control with no resolution in sight. Despite the drawn-out battle, Korea Zinc posted record first-half earnings, demonstrating the strength of its core business. But a series of events that could decide the outcome lies ahead, including an extraordinary shareholders meeting on the 9th of next month and a call option within the Young Poong-MBK alliance that comes due in October, pushing the dispute into a prolonged phase.
More than 30 lawsuits and injunction requests have been filed since the Young Poong-MBK consortium announced its tender offer on Sept. 13, 2024, according to financial investment industry and corporate sources on the 30th. The two sides recently traded criminal complaints, including allegations of unfair competition law violations, over the use of the name "Project Crucible" for a large-scale U.S. smelter project and over investor briefings held there.
The decisive contest at next month's extraordinary meeting, a major turning point in the two-year dispute, is a single audit committee seat filled through separate election. The four independent director seats also up for a vote, elected through cumulative voting, are likely to be split two apiece between Chairman Choi's camp and the Young Poong-MBK side. The board currently has 14 members — nine from Choi's camp and five from the Young Poong-MBK side. If Korea Zinc's candidate Baek In-kyu is elected to the audit committee, the board would be realigned at 12 to 7, firming up the current management's defenses.
If the Young Poong-MBK candidate Park Yoo-kyung is elected, the board would stand at 11 to 8, strengthening the private equity forces opposed to Korea Zinc's management and increasing uncertainty over its operations.
The key to the outcome is the combined 3% rule, which caps the voting rights of the largest shareholder and related parties at a combined 3% in audit committee elections. That neutralizes the Young Poong-MBK side's roughly 41% stake, leaving institutional investors, foreign shareholders and minority shareholders to decide the result. The Young Poong-MBK side sent letters on the 28th to major shareholders Hanwha (000880) and LG Chem (051910) asking them to support the election of an independent audit committee member. It argued that some funds Korea Zinc invested in were subsequently channeled into companies backed by Chairman Choi's family, and that the audit committee failed to screen the transactions, showing its oversight function was not working.
Korea Zinc dismissed the claim as "noise marketing for the shareholders meeting," saying it was merely a limited partner and that the fund manager independently selected the investment targets, adding that a review by financial authorities found no evidence of private gain.
Through two years of conflict, Korea Zinc set a first-half record with consolidated revenue of 12.4446 trillion won and operating profit of 1.3332 trillion won. It maximized profitability with eco-friendly recovery technology that extracts valuable metals from smelting byproducts, a response to China's export controls on gallium, germanium and antimony, while expanded semiconductor-grade sulfuric acid capacity and higher precious metal prices also drove earnings.
Still, prolonged management uncertainty remains a burden at a time of intense competition to secure global critical mineral supply chains. Relations between Young Poong and MBK could change significantly as early as October. If conditions are met and MBK exercises a call option to buy about 2.57 million Korea Zinc shares, or roughly a 12% stake, held by Young Poong, MBK would become the single largest shareholder and Young Poong would step back to the role of a purely financial investor. The combined stake would remain unchanged, but the center of gravity would shift between Young Poong, which is focused on securing management control, and the private equity firm, which wants to recover its investment, potentially reshaping the structure of the dispute. A proxy fight also appears unavoidable at the annual shareholders meeting in March next year.
"When global mining companies are investing heavily to secure critical minerals, a prolonged management dispute inevitably becomes a cost," an industry official said.