Today, the Seoul Central District Court once again dismissed the second injunction (which sought to suspend Korea Zinc’s (KRX:010130) share buyback) filed by MBK-Young Poong Group in an attempt to take control of Korea Zinc. The court had previously dismissed the alliance’s first injunction.
This ruling affirms MBK-Young Poong’s motive behind filing an injunction to deliberately increase uncertainty surrounding Korea Zinc’s share buyback and create anxiety among shareholders, pressuring them to accept the tender offer from MBK-Young Poong.
Despite being offered a guaranteed profit of KRW 60,000 higher than MBK-Young Poong’s tender offer, more than 5% of shareholders and investors were lured into participating in their offer, resulting in financial loss. In addition, by disrupting Korea Zinc’s share buyback, they engaged in market manipulation and fraudulent trading to disturb the market, actions which cannot evade investigation and legal accountability.
It has also become evident that the series of lies spun by MBK-Young Poong is now fully exposed. In the course of this tender offer, they not only fabricated judicial risks but also continued to shift their stance on the offer price and misrepresented Korea Zinc’s financial soundness and business excellence.
The issues surrounding MBK and Young Poong have been raised several times during this year’s National Assembly Inspections. There has been widespread criticism regarding MBK's failure to fulfill its promises and the controversies surrounding many of the companies it has acquired. Young Poong has also been repeatedly summoned to the National Assembly Inspection for the past decade but has failed to properly address its issues related to serious workplace accidents and environmental pollution.
In particular, as pointed out during the recent National Assembly Inspection, MBK was fined hundreds of billions of KRW following a tax investigation by the National Tax Service. Despite managing vast sum of capital, they have refused to adopt the Stewardship Code, demonstrating a lack of social responsibilities. The court’s ruling today signifies that preventing such a company from partnering with Young Poong, whose smelting business has been in the red, to take over the management of Korea Zinc is in the best interest of the company as a whole.
As the company has consistently emphasized, Korea Zinc will complete the ongoing share buyback, which is being conducted legally in accordance with the court's decision. Korea Zinc will also continue to strengthen its voting rights to prevent the MBK-Young Poong alliance from damaging the national core industry.
Through these actions, Korea Zinc aims to solidify management control and rapidly restore Korea Zinc’s operations, which were stalled by MBK’s surprise tender offer. As always, Korea Zinc will continue to contribute to the economic development of local communities, such as the Ulsan Metropolitan City, through job creation. As a leader in non-ferrous metal, an important pillar of the national core industry, and a key producer of materials for national strategic industries like semiconductors, secondary batteries, and rare metals, Korea Zinc will continue to fulfill its role in driving the country’s growth.
Moreover, Korea Zinc will maintain close cooperation with the remaining shareholders and continue efforts to enhance shareholder value. Korea Zinc will also support its employees, who have faced emotional difficulties due to the aggressive tender offer, helping them regain their strength and motivation.
Once again, it should be noted that protecting Korea Zinc from immoral forces, as exposed during the hostile M&A process and the National Assembly Inspection, is the company’s way of responding to the overwhelming support it has received. Korea Zinc promises to continue fulfilling its responsibilities as a socially accountable company.
View source version on businesswire.com: https://www.businesswire.com/news/home/20241021536866/en/
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