"Concerns Over Technology Leakage Abroad if MBK Acquires Korea Zinc"

Korea Zinc's 80+ Clients Express Concerns
"Potential Domestic Technology Leakage Overseas if Sold to Private Equity"

About 80 customers of Korea Zinc, including Korea & Company, Hu Steel, and Korea Gold Exchange, have voiced concerns over the attempts by private equity firm MBK Partners and Young Poong to acquire management rights. They expressed worries about the potential overseas technology leakage and quality degradation of key national infrastructure materials such as zinc, silver, and semiconductor materials produced by Korea Zinc.

On the 23rd, more than 80 domestic and international customers of Korea Zinc issued a "Request for Maintaining Korea Zinc Quality," expressing concerns about the possible disruption of the highest level of product quality continuity. Some customers, who requested anonymity, lamented the possibility that if Korea Zinc is sold in the future due to private equity, the country's top technology might be leaked overseas.

A view of the Onsan Smelter of Korea Zinc. [Photo by Korea Zinc]

Korea Zinc's main products are used as core materials across various national infrastructure industries. Zinc products are produced at 650,000 tons annually and are used domestically and internationally for protective coatings on steel materials such as automotive steel sheets, steel pipes, iron wires, and steel structures. Silver is produced at 450,000 tons annually and is widely used in domestic and international automotive batteries and wire cable industries. Silver is produced at 2,000 tons annually and is used in domestic and international photovoltaic industries, including electrical, electronic, and precious metal industries. The production volume of semiconductor sulfuric acid also reaches 250,000 tons annually.

Customers stated, "If MBK, which is attempting a hostile merger and acquisition (M&A), succeeds in the public tender offer, it will disrupt the ongoing efforts to restructure the value chain away from China in the secondary battery and semiconductor sectors," adding, "It will also negatively impact Korea Zinc's new growth engine, the 'Troika Drive,' ultimately causing significant contraction in the domestic secondary battery and semiconductor industries."