MBK Partners and Youngpoong criticized Choi Yun-bum, chairman of Korea Zinc, for advocating the introduction of a cumulative voting system at Korea Zinc while amending the articles of incorporation at its subsidiary, Seorin Trading (now KZ Trading), to exclude the cumulative voting system, calling it 'hypocrisy.'
On the 12th, MBK and Youngpoong stated that at the extraordinary general meeting of shareholders of Seorin Trading held on August 9 last year, Chairman Choi's side proposed and passed a measure to change the company name to KZ Trading along with a new provision in the articles of incorporation that excluded cumulative voting. Choi's family and Korea Zinc hold 66.7% of Seorin Trading's equity, allowing the measure to pass despite opposition from Youngpoong.
For the unlisted company Seorin Trading, a '3% rule' that limits voting rights to 3% is not applied when amending the articles of incorporation in relation to cumulative voting.
MBK and Youngpoong said, "Excluding the cumulative voting system at Seorin Trading was a tactic by Chairman Choi's side to prevent even one director from Youngpoong, a minority shareholder, from entering the board of directors." They claimed, "The global voting rights advisory firm ISS has already recognized the contradictory behavior and concealed intentions of Chairman Choi's side and issued a recommendation against the introduction of a cumulative voting system at this extraordinary general meeting of Korea Zinc."
Earlier, ISS recommended opposing the proposal to amend the articles of incorporation for the introduction of a cumulative voting system, which was suggested by Yumi Development, a family company of Chairman Choi, ahead of the extraordinary general meeting of Korea Zinc scheduled for the 23rd of this month.