Korea Zinc-backed activist platform accused of using major firms to attack Young Poong
Korea Zinc's shareholders line up to enter the company’s extraordinary shareholders' meeting at the Grand Hyatt Seoul, Jan. 23. Joint Press Corps
ACT, a platform presenting itself as representing minority shareholders, received financial support from Korea Zinc and deliberately targeted other major listed companies to justify an attack on Young Poong, which has teamed up with private equity firm MBK Partners in a dispute over the zinc smelter’s management rights, Young Poong claimed Wednesday.
The company called ACT’s actions “market-disrupting” and urged prompt intervention from financial authorities.
Young Poong cited an ACT report from Feb. 11 this year that showed the platform had carried out a project targeting companies unrelated to the management dispute, such as Emart and Lotte Shopping. Under the project, the platform planned to submit shareholder proposals, including the adoption of cumulative voting suggested by Young Poong Precision (now KZ Precision), controlled by Korea Zinc Chairman Choi Yun-beom.
The report also included plans to send shareholder letters to 20 major firms, including Samsung Electronics, Naver and Hyundai Motor, calling for the adoption of cumulative voting.
Through this strategy, according to Young Poong, ACT sought to shape public opinion that “since ACT has also demanded cumulative voting from major domestic companies, Young Poong Precision’s shareholder proposal against Young Poong is justified.”
“In effect, unrelated major firms were used as pawns to justify an attack on Young Poong,” a Young Poong official said.
The timing is especially noteworthy as ACT proposed the project to Korea Zinc before Young Poong and MBK Partners initiated their public tender offer to become the zinc smelter’s largest shareholder. This suggests that ACT, along with Chairman Choi and other Korea Zinc executives, coordinated attacks on other listed firms as part of the management dispute that began in March 2024.
"ACT’s market-disrupting actions have damaged the reputation of all listed companies," the Young Poong official added. "Regulatory authorities must act swiftly, as mechanisms like cumulative voting have been exploited for personal gain.”
A business community insider described the case as “an example of the legitimacy of shareholder activism being fundamentally undermined by self-interest.”
He noted that minority shareholder platforms are intended to support sound corporate governance and long-term value creation, but ACT was turned into a tool to serve a specific party in exchange for financial backing.