Korea Zinc "Strengthening Minority Shareholders' 'Casting Vote' Role with Introduction of Cumulative Voting System"

"The Board's Oversight Function Grows"... Refuting MBK's Claim

Korea Zinc reiterated that the 'cumulative voting system,' which is on the agenda for the upcoming extraordinary general meeting of shareholders, is an effective mechanism to protect minority shareholders.

The cumulative voting system grants voting rights equivalent to the number of directors to be appointed per share, allowing shareholders to concentrate their votes on a specific director candidate. It is regarded as a device to protect the rights of minority shareholders.

On the 2nd, Korea Zinc criticized MBK Partners and Youngpoong's claim that "even if the cumulative voting system is introduced, it is impossible to appoint directors recommended by minority shareholders," stating that "the justification of 'enhancing shareholder value,' such as protecting minority shareholders, has already disappeared as they are solely obsessed with controlling the board."

Choi Yoon-beom, Chairman of Korea Zinc, is speaking at a Korea Zinc press conference held at the Korea Chamber of Commerce and Industry in Jung-gu, Seoul, on November 13 last year. On that day, Chairman Choi stated, "I will step down from the position of chairman of the board as soon as possible, and an outside director will take over as chairman of the Korea Zinc board." Photo by Kim Hyun-min

The MBK-Youngpoong alliance previously argued that it is virtually impossible to appoint directors desired by specific minority shareholders even if the cumulative voting system is introduced. However, Korea Zinc rebutted, saying, "If a candidate recommended by minority shareholders is supported by one of the controlling shareholders, that director can easily enter the board."

Korea Zinc emphasized, "The checks and balances through mutual competition and the casting vote function will be greatly strengthened," adding, "As a result, the current management of Korea Zinc and controlling shareholders such as MBK and Youngpoong must actively communicate and build cooperative relationships with minority shareholders." It further interpreted that "(MBK and Youngpoong) are showing impatience out of concern that they will be hindered from forming a board of directors they desire while ignoring company development and minority shareholder protection."

Korea Zinc expects that the influence of minority shareholders will significantly increase through this system. This is because it will become very difficult for the current management of Korea Zinc and controlling shareholders such as MBK and Youngpoong to form a board solely for themselves. Korea Zinc explained, "Only by recommending individuals who align with the interests of general shareholders, including minority shareholders, and forming the board accordingly can they obtain cumulative voting votes from minority shareholders."

Meanwhile, at the extraordinary general meeting scheduled for the 23rd, Korea Zinc plans to promote policies to strengthen the independence and diversity of the board and shareholder-friendly policies, including ▲ introduction of the cumulative voting system ▲ codification of minority shareholder protection in the articles of incorporation ▲ stock split ▲ introduction of quarterly dividends ▲ change of dividend record date.

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