The prosecution has launched additional raids on Korea Zinc and the securities firms that acted as underwriters for its paid-in capital increase, on suspicion of unfair trading during the capital increase process.
On the 13th, people are entering the headquarters building of Korea Zinc in Jongno-gu, Seoul, where the board meeting to decide on the withdrawal of Korea Zinc's paid-in capital increase is being held.
On November 4, the Financial and Securities Crime Joint Investigation Unit of the Seoul Southern District Prosecutors' Office (headed by Chief Prosecutor Kim Jin-ho) announced that it is conducting searches and seizures at Korea Zinc, KB Securities, Mirae Asset Securities, and certain departments of Hana Bank in connection with the unfair trading case involving Korea Zinc, which was referred by the Financial Services Commission.
The prosecution is investigating whether Korea Zinc violated the Capital Markets Act during the announcement of its 2.5 trillion won paid-in capital increase on October 30 last year, which followed its own share buyback.
The suspicion is that Korea Zinc, which conducted a tender offer for its own shares from October 4 to 23 last year, failed to properly disclose its plan for a paid-in capital increase before the tender offer was completed, even though such a plan was already in place. The Financial Supervisory Service referred the case to the prosecution in January this year.
The prosecution intends to examine whether the failure to state in the tender offer report that the board of directors planned to cancel treasury shares through a buyback and then replenish them via a paid-in capital increase constitutes unfair trading.
In April this year, the prosecution had already raided six offices, including the headquarters of Korea Zinc, Mirae Asset Securities, and KB Securities, as well as five residences.
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