[2024 National Audit] Lee Bok-hyun "Investigating Fairness of Trade in the Korea Zinc Incident"

National Assembly Political Affairs Committee Financial Supervisory Service Audit

Lee Bok-hyun, Governor of the Financial Supervisory Service, is responding to lawmakers' questions during the National Assembly's Political Affairs Committee's audit of the Financial Supervisory Service held on the 17th. Photo by Kim Hyun-min

Lee Bok-hyun, Governor of the Financial Supervisory Service (FSS), stated on the 17th that they are examining whether there has been any unfair trading in the management rights dispute between MBK Partners·Yeongpung alliance and Korea Zinc.

On the afternoon of the same day, during the National Assembly's Political Affairs Committee audit, Governor Lee said regarding the Korea Zinc incident, "There is an aspect of market overheating, and in the process, there is a possibility of unfair trading, so we are looking at it from various perspectives."

This was an explanation following Governor Lee's directive on the 8th of this month to strictly manage and supervise Korea Zinc's public tender offer and to investigate unfair trading.

During the audit, Kim Hyun-jung and Park Sang-hyuk of the Democratic Party of Korea and Lee Heon-seung of the People Power Party expressed common concerns regarding MBK Partners·Yeongpung alliance's acquisition of Korea Zinc. Korea Zinc is a company that possesses the world's number one smelting technology. Because of this, concerns were raised that if acquired by MBK, core technology could be leaked overseas, including to China. Additionally, the typical private equity fund management style of maximizing corporate value through various means such as restructuring was also pointed out as an issue.

In response to questions about the role of the FSS, Governor Lee replied, "In cases of capital market regulations that discriminate based on the nationality of capital, we will consider within the government whether this aligns with the international capital movement and globalization we aim for, whether our capital market regulations are appropriate, and whether an industrial strategic approach to national strategic industries or key industries is suitable."

Regarding the point that the United States assesses foreign control over investment companies, he answered, "In the U.S., rather than discriminating by nationality or form in the capital market, they mainly block foreign access based on the importance of specific industries."

Meanwhile, MBK has clearly stated that it will not sell Korea Zinc to China. Currently, Chinese capital accounts for about 5% of MBK's shareholder composition.

Kim Kwang-il, Vice Chairman of MBK Partners, responded, "We will fulfill our role as shareholders so that there is no problem with the role and status as a national key industry." He also said, "We consider this as part of improving corporate governance," and added, "In that regard, we will do our best to contribute to the capital market."