MBK Claims "False Information in Korea Zinc Shareholders' Materials"... Warns of Criminal Charges

"Spreading False Information and Defamation... Remove Immediately"

On August 20, MBK Partners announced that the side of Choi Yoonbeom, inside director of Korea Zinc, had included false information and made distorted claims in the agenda explanation material ahead of the extraordinary general meeting of shareholders scheduled for September 9, and demanded the immediate removal of this content. MBK Partners also expressed that if the request is not met, they will file criminal charges for spreading false information and defamation.

The agenda explanation material is a document created and distributed by the company so that shareholders can refer to it when making decisions for or against the agenda items. The material posted on the Korea Zinc website is 49 pages in length, with 8 pages dedicated to the section titled "Concerns regarding the limits of MBK and Youngpoong's management capabilities and governance impairment." In the five pages related to MBK, nine acquired companies appear with initials instead of their full names.

The section with the most coverage is for "Company H." According to the document, Company H closed or sold more than 20 branches and then leased them back to pay off acquisition funds totaling 4.3 trillion won. It also states that Company H issued short-term bonds up until ten days before filing for rehabilitation proceedings.

The remaining eight companies are briefly described in one or two sentences each: ▲ Card company "Company L" embezzlement and breach of trust amounting to 10.5 billion won and leakage of credit information for 2.97 million people ▲ Large-scale reorganization of staff and job eliminations after the acquisition of dental implant company "Company O" ▲ Steel structure company "Company Y" acquired in 2009 for 100 billion won and sold in 2017 for 49.6 billion won ▲ Chicken franchise "Company B" fined 350 million won for violating franchise business laws ▲ After the acquisition of insurance company "Company I," 18 out of 32 executives departed within 6 months ▲ Despite a decline in earnings, outdoor brand "Company N" continued to pay preferred stock dividends ▲ Cable TV company "Company D" saw its debt ratio rise from 388% in 2007 to 1,054% in 2023 ▲ E-commerce company "Company C" was delisted just two years after acquisition.

For Youngpoong, the other two pages outline a summary timeline of environmental law violations at Seokpo Smelter and records of accidents in which 15 people have died since 1997.

MBK Partners asserted, "Korea Zinc deliberately excluded objective facts and selectively highlighted biased information regarding the management activities of executives at our portfolio companies," further claiming that putting falsehoods or omitting significant facts from documents that affect the exercise of shareholders’ voting rights constitutes an illegal act that damages others' reputation and credit.

Page 33 of "2026 Extraordinary General Meeting Explanation Materials" posted on Korea Zinc's website.

MBK Partners also stated that the portfolio companies mentioned in the material had each sent protest letters to Korea Zinc.

An MBK Partners official commented, "Current management at Korea Zinc, including inside director Choi Yoonbeom, are facing various allegations of illegal and unlawful activities, as well as sanctions from financial authorities. Instead of explaining these fundamental issues to shareholders, they are indiscriminately dragging in unrelated external companies into the agenda of the general meeting, distorting facts and defaming others."

The official added, "Disseminating information that does not reflect the facts, to the point of breaking the law to sway votes ahead of the extraordinary general meeting, undermines the fair order of the capital market and shareholder rights. If Korea Zinc does not immediately delete the false material and continues inappropriate solicitation with voting rights, we will take all possible legal actions to protect shareholder rights and market trust."

This content was produced with the assistance of AI translation services.