Young Poong, the largest shareholder of Korea Zinc, demanded that Chairman Choi Yoon-beom apologize for the suspension of the validity of the agenda items at the extraordinary shareholders' meeting and the public buyback of its own shares. This was a response to Chairman Choi's suggestion to discuss cooperation with MBK Partners the day after the extraordinary shareholders' meeting held on the 23rd of last month. Young Poong and MBK are targeting the management rights of Korea Zinc.
Young Poong issued a statement titled "If you want to compromise, return to the original position first" on the 5th, stating, "The illegal surprise measure taken to eliminate the voting rights of the largest shareholder, Young Poong, is close to a calamity." It added, "Acknowledge that what happened at the shareholders' meeting was unlawful and unfair and declare that the voting rights are invalid."
Korea Zinc restricted the voting rights of Young Poong, which holds about 25% of Korea Zinc's equity, after its Australian subsidiary, Sunmetal Corporation (SMC), acquired a 10.33% stake in Young Poong the day before the extraordinary shareholders' meeting. According to Article 369, Paragraph 3 of the Commercial Act, when two corporations own more than 10% of each other's equity, they cannot exercise voting rights against each other, and this provision was applied.
As Korea Zinc restricted Young Poong's voting rights, all agenda items proposed by Young Poong and MBK were rejected at that day's extraordinary shareholders' meeting, while all proposals made by Korea Zinc passed. Young Poong and MBK attempted to take control of the board by electing many outside directors at the extraordinary meeting but failed.
Young Poong noted regarding the restriction of voting rights by Korea Zinc, "We suggested seeking a court ruling on the dispute over the restriction of Young Poong's voting rights, but what was done was an atrocity."
Young Poong also demanded an apology regarding the public buyback of own shares conducted by Korea Zinc. Young Poong stated, "Chairman Choi should bow his head and apologize to the remaining shareholders for the large-scale public buyback conducted to protect his personal management rights," and added, "Such a buyback was an act of taking the property of remaining shareholders and giving it to departing shareholders with a premium." It further criticized, "As a result, nearly 20% of the company's net worth was leaked out."