Korea Zinc formed a mutual shareholder relationship by acquiring Youngpoong shares of its affiliates just before the start of the regular shareholders' meeting on the 28th, and again restricted the voting rights of Youngpoong.
At the shareholders' meeting held at Mondrian Hotel Itaewon in Yongsan-gu, Seoul, Korea Zinc blocked Youngpoong and MBK's control of the board of directors, and Choi Yoon-beom, chairman of Korea Zinc, succeeded in taking over management control.
With the approval of the amendment to the articles of incorporation, which sets the upper limit of the number of directors to 19 or less, the appointment of eight directors under the upper limit of the number of directors and the concentrated voting system was put to the vote.
As a result, all five candidates recommended by Chairman Choi were elected as directors. On the other hand, among the 17 people recommended by Youngpoong and MBK, only three were listed on the board: Youngpoong President Kang Sung-doo, MBK Partners Vice Chairman Kim Kwang-il, and Kwon Kwang-seok.
If the existing board members are added and the four directors of Chairman Choi's side who have been suspended from their duties are excluded, Chairman Choi has secured 11 candidates and Youngpoong and MBK have secured four candidates for directors.
Youngpoong and MBK, which prepared a bridgehead for management participation by entering the board of directors on this day, predicted an immediate legal response. As a result, the management dispute is expected to prolong.
Youngpoong and MBK said, "The Korea Zinc shareholders' meeting, where even the basic rights of shareholders were violated due to repeated illegal activities, will be recorded as a stain on the K-capital market," adding, "We will use possible methods such as immediate appeal and suspension of validity for the results of the regular shareholders' meeting distorted by Youngpoong's voting restrictions, and correct the distorted shareholders' intentions in the court."
Chairman Choi defended his management rights, but Youngpoong and MBK Partners criticized him for repeating his illegal activities by making a third round of circular investment at a time when the Fair Trade Commission's circular investment investigation is underway.
The management dispute is expected to prolong as Youngpoong and MBK, which succeeded in preparing a bridgehead for management participation, forewarned an immediate legal response.
Sunmetal Holdings (SMH), an Australian subsidiary of Korea Zinc, announced that it acquired 1,350 common shares of Youngpoong from Kjet Precision (formerly Youngpoong Precision) through over-the-counter purchases and changed its stake to 10.03%.
The previous night, when Youngpoong dropped SMH's stake in Youngpoong to below 10% through stock dividends at its regular shareholders' meeting, it hurriedly bought Youngpoong's stake and restricted Youngpoong's voting rights again. Under the Commercial Act, the restrictions on mutual stock voting rights due to the formation of circular investment apply when you have more than 10% stake.
Initially, Youngpoong and MBK secured 40.97% of Korea Zinc shares and Chairman Choi secured 34.35% (including friendly shares). However, as the exercise of voting rights for the 25.4% stake in Youngpoong was restricted, Korea Zinc gained an advantage in voting on the shareholders' meeting agenda.
