A dispute is ongoing over control of Korea Zinc between Chairman Choi Yun-beom and the MBK Partners-Youngpoong alliance, as the National Pension Service will discuss the direction of voting rights on the 17th of this month.
According to the financial investment industry on the 10th, the National Pension Service's fiduciary responsibility committee (hereinafter referred to as the committee) will hold a meeting on the 17th to decide the direction of exercising voting rights regarding the agenda for the temporary shareholders' meeting of Korea Zinc. The committee is a specialized committee that discusses and decides whether to exercise the voting rights of the National Pension Service.
The National Pension Service fundamentally determines the direction of exercising voting rights for listed companies through its investment committee within the Asset Management Headquarters. However, if one-third or more of the committee members determine that the matter is significant, it receives the relevant agenda from the investment committee for discussion.
According to the Financial Supervisory Service's electronic disclosure, as of Oct. 28 last year, the National Pension Service held 934,443 shares (4.51%) of Korea Zinc. Excluding Chairman Choi and the MBK-Youngpoong alliance, which hold an estimated 33-34% and 40.97% respectively, it is the largest shareholder in terms of equity. Excluding both parties in the dispute and the National Pension Service, the share of minority shareholders is estimated to be around 7-8%.
The temporary shareholders' meeting of Korea Zinc will be held on the 23rd of this month. Korea Zinc has submitted an agenda item to introduce a cumulative voting system and set the upper limit for the number of board directors at 19. The MBK-Youngpoong side has proposed the introduction of an executive officer system and the appointment of 14 new directors. Chairman Choi has submitted candidates for seven outside directors.
The introduction of the cumulative voting system is seen as a contentious agenda item for this shareholders' meeting. Cumulative voting is a system that grants voting rights equal to the number of directors to be elected for each share; thus, if 10 directors are to be elected, 10 voting rights are provided per share. This means that voting rights can be concentrated on specific director candidates. It is a card that Chairman Choi has played to counter the MBK-Youngpoong alliance.
Chairperson Han Seok-hoon of the committee, in a recent interview with Monthly Chosun, pointed out that "the cumulative voting system is an extraordinary system that contradicts the one share, one vote principle." However, market opinions suggest that the committee cannot rule out the possibility of abstaining or remaining neutral. There are precedents for choosing to abstain or remain neutral when opinions sharply divide, as seen during the management dispute over Hanmi Science in November of last year, where the National Pension Service committee declared neutrality.