A fresh dispute has erupted between Youngpoong and MBK Partners on one side and Korea Zinc on the other, ahead of a separate election for the company's audit committee member. Korea Zinc announced it would accept preliminary outside director candidates through a shareholder nomination process, but Youngpoong and MBK criticized the eligibility requirements as overly restrictive.
According to investment banking industry sources, Korea Zinc's outside director candidate recommendation committee announced June 2 that it would accept nominations for preliminary outside director candidates to be appointed at an extraordinary general meeting scheduled later this year. The nominated outside director is expected to join the audit committee upon appointment. The nomination deadline is June 30.
In a statement released Thursday, Youngpoong and MBK said the committee had set the eligibility criteria for nominating shareholders too narrowly. Under the announcement, shareholders holding at least 0.1 percent of total issued shares for six months or more, or those holding at least 1 percent of total issued shares, may each nominate one outside director candidate.
Youngpoong and MBK said the criteria effectively undermine the purpose of an open public nomination process by limiting participation to an extremely small number of shareholders. "As of the end of March 2026, only 47 shareholders on a beneficial ownership basis hold 0.1 percent or more," the two said. "When the six-month holding requirement is factored in, the pool of shareholders eligible to nominate candidates on behalf of ordinary shareholders shrinks even further."
They added that excluding Hanwha Group and Mirae Asset, only two or three institutional shareholders meet the eligibility requirements to nominate outside director candidates independently of the first and second largest shareholders. "These institutions are asset managers that must maintain procedural neutrality, making it practically difficult for them to participate in the nomination process," they said.
In response, Youngpoong and MBK said they plan to run a separate, independent outside director nomination process of their own. "We intend to openly solicit nominations for independent outside director candidates from all shareholders holding at least one share of Korea Zinc, as well as from public-interest organizations and professional associations," they said, adding that they would not put forward any of their own personnel as candidates in the separate audit committee member election.
In other words, while the nomination process would be open to all shareholders, Youngpoong and MBK said they would not exercise their own nomination rights as shareholders.
"We plan to evaluate candidates through a transparent vetting process conducted by a committee composed of NGOs and other organizations active in corporate governance reform," Youngpoong and MBK said. "The final selected candidate will be put forward through a shareholder proposal as a representative of all Korea Zinc shareholders — not as a Youngpoong or MBK candidate."
Korea Zinc's board currently has 14 members: three inside directors — Choi Yun-beom, Park Ki-deok and Jeong Tae-ung — three non-executive directors — Jang Hyeong-jin, Kim Gwang-il and Kang Seong-du — and eight outside directors. At the 52nd annual general meeting held in March, Chairman Choi Yun-beom and board chair Hwang Deok-nam were reappointed as outside directors. Walter Field McLallen, nominated by Crucible JV, was appointed as a non-executive director. Among the director candidates put forward by Youngpoong and MBK, Choi Yeon-seok was appointed as a non-executive director and Lee Seon-suk as an outside director.
park.jiyeong@heraldcorp.com
