MBK Partners and Youngpoong announced on the 23rd that they have already submitted a complaint to the Financial Supervisory Service regarding Koryo Zinc's market manipulation, unfair trading acts aimed at obstructing the tender offer, and rumor spreading activities.
MBK stated, "Koryo Zinc attempted to interfere with the tender offer by MBK and Youngpoong, which began on the 13th of last month, by spreading information in the market that SoftBank and Sumitomo from Japan, as well as US-based private equity funds, would emerge as allies of Koryo Zinc, thereby trying to set Koryo Zinc's stock price higher than the tender offer price by MBK and Youngpoong."
They continued, "Koryo Zinc repeatedly engaged in unfair trading acts, such as announcing the 'notice of board meeting' to the media on the afternoon of October 1st, three days earlier than the public disclosure date of October 4th, in order to inform the market in advance of their plan to acquire treasury shares at a price higher than the tender offer price by MBK Partners and Youngpoong."
Furthermore, "At that time, since Koryo Zinc disclosed the board resolution two days earlier, the market was able to know about the treasury share tender offer price and quantity two days before Koryo Zinc filed the tender offer report," adding, "This was not only to stimulate market expectations and create an effect of surpassing the tender offer price by MBK and Youngpoong, but also aimed to reduce the subscription expectations for MBK and Youngpoong's tender offer."
At that time, financial authorities also stated that if rumor spreading activities and acts that could unfairly influence stock price formation were confirmed, strict measures would be taken according to laws and principles; however, it is claimed that Koryo Zinc's unfair trading acts continued.
MBK mentioned, "Koryo Zinc even announced that 1.5 trillion KRW of their own funds would be injected as 'ammunition' for the treasury share tender offer and heavily promoted this in the media, only to later amend the tender offer report to indicate that the funds were borrowed, causing a problematic situation."
They also said, "In the case of Youngpoong Precision, the fact of a stock collateral contract involving a change of the largest shareholder was separately delayed in disclosure only by CEO Yoo Joong-geun, misleading the market into thinking that additional funds for the tender offer had been secured, which led to the company being designated as an unfaithful disclosure corporation."
MBK stated, "Throughout the tender offer period, it was Chairman Choi Yoon-beom and Koryo Zinc who caused confusion among investors and repeatedly engaged in market disruption," adding, "Shareholders are watching the situation where not only Koryo Zinc's governance but also compliance has completely collapsed."
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