Korea Zinc said on the 16th that claims regarding YPC, a limited company established by MBK Partners and Young Poong, acquiring shares of Korea Zinc to resolve the circular investment structure, is "a legal misinterpretation." This is due to reasons including the assertion that the in-kind contribution to YPC is ineffective as it occurred after the closure of this week's shareholders' meeting.
Korea Zinc explained, "For YPC to acquire shares, the procedures prescribed by law must be completed, yet MBK and Young Poong are presenting a legal misinterpretation, claiming the effectiveness of the transfer of shares from Young Poong to YPC occurred upon the application for establishment registration."
Earlier, Korea Zinc transferred equity to its parent company and publicly traded company, Semetal Holdings, to limit Young Poong's voting rights. In response, MBK and Young Poong claimed that after establishing the limited liability company YPC, Young Poong made an in-kind contribution of 5,262,450 shares of Korea Zinc it owns. They argue that since the structure from Korea Zinc to SMH to Young Poong to Korea Zinc does not exist, the voting rights will not be limited as they were during the shareholders' meeting in January.
Korea Zinc stated in response that "according to the Law on Electronic Registration of Stocks and Debentures, electronic registration for shares of Korea Zinc, as a listed company, must be completed for the transfer to become effective." They emphasized, "Although Young Poong belatedly disclosed on the 14th that it established 'a reporting entity by in-kind contributing shares issued on March 7' and acquired them on the same day, they have not responded to whether the electronic registration procedure for the transfer between accounts was completed before the registration of establishment of the corporation."
Korea Zinc added, "According to Article 342-3 of the Commercial Act, if YPC has acquired more than one-tenth of the total number of issued shares of Korea Zinc, it must notify Korea Zinc without delay, but no notification has been made."
Additionally, it stated, "The reference date for the regular shareholders' meeting of Korea Zinc was December 31 of last year, and the only company listed as a shareholder on that day is Young Poong, not YPC, so the company with voting rights in this upcoming regular shareholders' meeting is already confirmed as Young Poong."
Korea Zinc has stated, "We plan to conduct this regular shareholders' meeting in accordance with legal procedures and will do our utmost to prevent hostile mergers and acquisitions to protect Korea Zinc's sustainable growth, corporate value, and future growth drivers."