The battle for control of Korea Zinc Co. has reached a critical phase as competing tender offers closed on October 14. MBK Partners and Young Poong concluded their offer at 830,000 won ($612) per share for up to 14.6% of the company, while Chairman Choi Yoon-beom’s higher bid of 890,000 won ($656) for up to 20% continues until October 23.
The outcome, expected to be announced on October 17, could significantly alter the company’s management structure. Currently, Choi’s faction holds 33.99% of shares, while MBK Partners and Young Poong control 33.13%.
Shareholders face a complex decision, balancing price differentials against legal and tax considerations. MBK Partners has challenged Choi’s offer in court, claiming it violates fiduciary duty. The ruling on this injunction request could sway investor sentiment.
Tax implications also factor in, with MBK’s offer subject to capital gains tax of 22-27.5%, while Choi’s buyback incurs dividend income tax starting at 15.4%.
Industry observers suggest that securing a 7% stake could give MBK Partners an edge, effectively achieving majority control. The close contest leaves both sides without a clear advantage, potentially leading to prolonged boardroom conflicts.
