On the 28th, the alliance of Young Poong and MBK Partners, attempting to gain control of Korea Zinc, was unable to exercise some voting rights at the Korea Zinc regular shareholders' meeting. As a result, Chairman Choi Yoon-beom's side is expected to maintain its leadership in the Korea Zinc board of directors. At this regular shareholders' meeting, if the maximum number of directors is set to 19, they plan to appoint 8 directors using a cumulative voting method. Since there are 5 director candidates recommended by Korea Zinc, the remaining three seats are likely to go to Young Poong and MBK.
The Seoul Central District Court's Civil Division 50, presided over by Chief Judge Kim Sang-hoon, dismissed on the 27th the injunction filed by the Young Poong and MBK alliance to allow the exercise of voting rights at the shareholders' meeting of Korea Zinc. Consequently, the Young Poong and MBK alliance will not be able to exercise their voting rights for their 25.4% stake at the Korea Zinc regular shareholders' meeting on the 28th.
The equity ratio of the Young Poong and MBK alliance (40.97%) surpasses that of Chairman Choi's side (34.35%). To defend management rights, Chairman Choi's side formed a circular shareholding structure to block the voting rights of the Young Poong and MBK alliance, and both sides have been engaged in a dispute over whether to exercise voting rights.
With the dismissal of this injunction application, Chairman Choi's side has secured a favorable position. Currently, the Korea Zinc board consists of 5 directors from Chairman Choi's side and 1 director from Young Poong, with plans to appoint 8 additional directors at this shareholders' meeting. There are 5 candidates from Korea Zinc and 17 candidates from Young Poong and MBK, including Kim Kwang-il, vice president of MBK Partners, and Kang Seong-du, president of Young Poong. If Chairman Choi's side appoints 5 new directors, the remaining three seats are expected to be filled by personnel from Young Poong and MBK.
Chairman Choi's side noted that on January 23, a day before an extraordinary shareholders' meeting, Korea Zinc's Australian subsidiary, Sun Metal Corporation (SMC), formed a circular investment structure by acquiring 10.3% of Young Poong's equity. The Young Poong and MBK alliance immediately filed for an injunction to halt the effectiveness of the Korea Zinc extraordinary shareholders' meeting resolution, and on the 7th, the court partially granted the request, determining that Young Poong's voting rights restrictions were unjust.
In response, Korea Zinc limited Young Poong's voting rights by contributing SMC's stake to its Australian subsidiary, Sun Metal Holdings (SMH), thus creating a new cross-shareholding relationship. The Young Poong and MBK alliance filed for an injunction to allow voting rights at the Korea Zinc regular shareholders' meeting, which was dismissed on the same day.