Concerns Over the 'Second Urea Water Crisis'... "MBK's Acquisition of Korea Zinc Could Disrupt Rare Metal Supply Chain"

Korea Zinc, Virtually the Only Domestic Indium Supplier
Also Extracts Cobalt, a Key Material for Cathode Active Materials with Difficult Resource Securing
"Hostile M&A Is a Real Issue in the Industry"

Korea Zinc, a major producer of non-ferrous metals such as zinc, silver, and copper, plays an important role in the domestic rare metal supply chain. Recently, concerns have grown that the ongoing management rights dispute could have a significant impact on the domestic industrial sector. If management rights are transferred to MBK Partners, there is a possibility that the stable supply chain of rare metals essential to the domestic non-ferrous metals and advanced industries could be disrupted.

According to the non-ferrous metals industry on the 16th, Korea Zinc extracts rare metals such as indium, cobalt, and tellurium during the smelting process of zinc and lead concentrates imported from around the world and supplies them to the industrial sector. In particular, indium is an essential material in advanced industries such as displays, touchscreens, and solar panels. Korea Zinc accounts for 11% of the world's indium production and is almost the sole supplier in Korea. The industry views that establishing a stable supply chain is crucial because these rare metals are produced only in specific countries.

[Photo by Korea Zinc website capture]

Korea Zinc also holds an important position in the production of cobalt, a key material for electric vehicle batteries. Cobalt is a core material of secondary battery cathode materials that determine battery life. Since 70% of the global cobalt supply is concentrated in the Congo, making resource acquisition difficult, Korea Zinc contributes to supply chain stability by recovering a very small amount of cobalt in its smelting process and supplying it.

An industry official explained, "Korea Zinc plays an important role in the domestic industrial sector by producing not only major non-ferrous metals such as zinc and lead but also rare metals."

A Korea Zinc representative expressed concern, saying, "The urea solution crisis that occurred amid conflicts between China and Australia is a representative case of supply chain instability. If key domestic rare metal technicians move to overseas competitors, the negative impact on the domestic industry could be severe." They added, "Hostile mergers and acquisitions (M&A) of Korea Zinc is a matter of survival and existence for the industrial sector."

Korea Zinc currently records the world's largest zinc production based on a single smelting plant. It also holds the number one global market share in the production of lead and silver.