Korea Zinc Calls for Transparency in MBK Partners’ Acquisition Agreement

- Calls for public disclosure of MBK Partners and Young Poong shareholder agreement, with a focus on call options terms to ensure clarity on governance and industry stability

- Lack of transparency raises potential risks to Korea Zinc’s governance, financial stability, and its role in national and global supply chains.

Korea Zinc Calls for Transparency in MBK Partners’ Acquisition Agreement

FleishmanHillard
Aesop Kim
+82-10-3200-0493
aesop.kim@fleishman.com

Korea Zinc (KRX:010130), a global leader in the production of non-ferrous metals and a key player in critical supply chains, is calling for greater transparency from MBK Partners and Young Poong regarding the shareholder agreement tied to MBK’s acquisition of Korea Zinc. Korea Zinc stresses the need for a full disclosure, particularly around the call option arrangement, to help stakeholders understand its potential impact on governance, financial stability, and the company’s strategic role in global supply chains.

Korea Zinc argues that transparency is essential in a transaction of this magnitude, adding MBK must disclose the specific terms of the agreement, including the call option pricing and conditions, so stakeholders can make informed decisions about the future of Korea Zinc.

Conflicting reports about the agreement between MBK Partners and Young Poong have led to uncertainty. According to recent reports, it has been suggested that MBK could acquire shares at a reduced price while shifting financial responsibility away from Young Poong. While MBK claims the call option price is fixed, the detailed disclosure has not been made public. Korea Zinc stresses that without transparency, stakeholder confidence could be undermined, potentially affecting the company’s stability.

Global Supply Chain Risks

Korea Zinc’s pivotal role in securing non-Chinese supply chains for critical materials like nickel and battery precursors makes this acquisition particularly sensitive. Any shift in the company’s governance or financial structure could have ripple effects across these supply chains, raising concerns about the future direction of Korea Zinc and the industries it supports. Stakeholders are advised to carefully evaluate the long-term risks and benefits of the acquisition.

Implications for Strategic Industries

Korea Zinc’s partnerships with major players including major Korean conglomerates, are vital for innovation and growth in the electric vehicle sector. Any disruption caused by MBK’s acquisition, particularly due to undisclosed financial mechanisms, could affect future developments in these industries. The lack of transparency around the call option agreement heightens these risks, leaving stakeholders to question whether MBK’s interests align with the long-term health of the strategic industries dependent on Korea Zinc’s output.

As the acquisition progresses, Korea Zinc remains committed to supporting global supply chains and critical industries by producing essential materials. Korea Zinc urges global stakeholders to carefully evaluate the long-term implications of MBK Partners’ acquisition on key sectors like electric vehicles and non-ferrous metals. Full disclosure of the financial agreement, including the call option with Young Poong, is essential to understanding the potential risks to Korea Zinc, its strategic partners, and the stability and growth of global supply networks.