On the afternoon of May 23, an extraordinary general meeting is held at the Grand Hyatt Seoul in Yongsan-gu, Seoul. /Courtesy of News1

The consortium of Young Poong and MBK Partners, which is seeking to secure management rights in Korea Zinc, has filed another injunction.

Young Poong stated on the 31st that it filed an injunction with the Seoul Central District Court to suspend the effectiveness of the resolutions made at the extraordinary general meeting of Korea Zinc held on the 23rd.

Young Poong claimed, "Chairman Choi Yoon-beom's side has unjustly limited Young Poong's voting rights based on the Commercial Act provisions that restrict mutual shareholder voting rights," adding that it was "null and void" due to arbitrary legal interpretation.

Earlier, on the 23rd, Korea Zinc held an extraordinary general meeting and passed agendas to limit outside directors to 19 and to appoint 7 directors recommended by Korea Zinc.

The day before the extraordinary general meeting of Korea Zinc on the 22nd, Korea Zinc's wholly-owned Sun Metal Corporation (SMC) suddenly acquired 10.33% of the Young Poong shares held by the Choi family.

Chairman Choi's side classified SMC's acquisition of Young Poong shares as a circular investment, restricting all voting rights for Young Poong's 25.4% stake in Korea Zinc.

Ultimately, Chairman Choi's side easily won in the vote, rejecting all agendas including the appointment of 14 outside directors proposed by the Young Poong and MBK Partners consortium.

The Young Poong and MBK Partners consortium stated that the unilateral voting rights restriction measure is illegal and unfair and that they intend to rectify it within the bounds of the law.

Chairman Choi's side has judged that it unlawfully expanded the application of the law limiting mutual shareholder voting rights to SMC’s shareholding situation, fundamentally infringing upon Young Poong's shareholder rights.

The Young Poong and MBK Partners consortium also emphasized that Section 3 of Article 369 of the Commercial Act regarding mutual shareholder voting restrictions applies only to 'domestic' 'corporations' established under domestic law based on its wording.

According to the Young Poong and MBK Partners consortium, SMC is not only a foreign company established under Australian law but also, considering its closed nature, is closer to a limited company than a corporation.

An MBK Partners official noted, "The resolution of the extraordinary general meeting of Korea Zinc on Jan. 23 was made under illegal and unfair logic and should be canceled or deemed void."

Meanwhile, Young Poong reported Korea Zinc, Chairman Choi, and the current and former board members of SMC to the Fair Trade Commission on charges of violating the Fair Trade Act.