Korea Zinc: "Seorin Sangsa is an unlisted company... MBK's 'self-serving' interpretation to seize board control" (Comprehensive)

Debate Over Introduction of Cumulative Voting System at Korea Zinc
MBK and Youngpoong: "Seorin Sangsa Excluded from Cumulative Voting"
Korea Zinc: "A Company Without Minority Shareholders... Opposition for the Sake of Opposition"

In response to MBK Partners and Youngpoong's claim that excluding the introduction of a cumulative voting system for Seorin Sangsa (currently KZ Trading), a subsidiary of Korea Zinc, is a case of 'double standards,' Korea Zinc criticized, saying, "They are continuing to make baseless claims by citing inappropriate examples."

On the 13th, Korea Zinc stated, "MBK and Youngpoong are deliberately hiding the fact that Seorin Sangsa is an unlisted company and are mentioning the cumulative voting system on the same level as Korea Zinc, which ranks 19th in market capitalization." Seorin Sangsa is a company with no other minority shareholders or institutional investors.

Korea Zinc criticized, "This is the height of a self-serving interpretation that completely fails to understand the political and social discussions for the introduction of the cumulative voting system or the intentions and purposes of the market and minority shareholders regarding its necessity." It added, "Even though the market sympathizes with the purpose of the system, MBK and Youngpoong are risking everything to oppose it simply for the sake of opposition."

MBK and Youngpoong issued a press release the previous day criticizing Chairman Choi Yoon-beom, who advocates for the introduction of the cumulative voting system at Korea Zinc, for changing the articles of incorporation to exclude cumulative voting at Seorin Sangsa, calling it a typical case of double standards. They also cited the global proxy advisory firm ISS's recommendation to oppose the introduction of the cumulative voting system at the upcoming extraordinary shareholders' meeting on the 23rd, stating, "Chairman Choi is abusing the system to protect his position."

Korea Zinc argued that MBK and Youngpoong's opposition to the introduction of the cumulative voting system, even citing the case of the unlisted company Seorin Sangsa, reflects their intention to block any system that could hinder their control over Korea Zinc's board of directors. Korea Zinc explained, "The cumulative voting system allows shareholders to vote independently for director candidates, enabling shareholders to exert greater influence," adding, "It has the effect of enhancing transparency in corporate governance."

Regarding ISS, Korea Zinc mentioned that ISS recommended supporting the current management's proposal to amend the articles of incorporation to set a cap on the number of directors, while only recommending support for 4 out of the 14 directors proposed by MBK and Youngpoong. Korea Zinc interpreted this as, "Limiting the board to 16 members can be seen as a check on MBK and Youngpoong's attempt to dominate the board," and "It focuses on maintaining a governance structure centered on the current management while expanding the diversity of board members."