#South Korea #Seoul #Korea Zinc #MBK Partners #Young Poong

Court Ruling on Young Poong's Voting Rights

In a significant legal development, the Seoul Central District Court has ruled that the restriction on Young Poong's voting rights at Korea Zinc's extraordinary shareholders' meeting conducted on January 23 was unlawful. This ruling effectively suspends the validity of numerous resolutions, including key proposed changes to the company's governance structure. This decision represents a considerable victory for Young Poong and its partner MBK Partners, who are the largest shareholders of Korea Zinc.

The court's verdict came after an injunction request was made by Young Poong and MBK Partners. The ruling highlighted that the restriction of voting rights contravenes Article 369, Paragraph 3 of the Commercial Act, which governs corporate voting procedures in South Korea. The judge noted that the improper process led to significant procedural defects in the appointment of the seven directors nominated by Korea Zinc. Consequently, these directors are now barred from fulfilling their roles until the matter is revisited.

The suspended resolutions included key issues such as:

• - The establishment of a cap on the number of directors,
• - A proposed stock split,
• - Amendments to the dividend record date,
• - The introduction of quarterly dividends,
• - The appointment of the board chair from outside directors.

While the resolution to amend the articles for cumulative voting remains intact, the cap limiting the board size has been nullified. This opens up a pathway for a more balanced representation on the board, crucial for Young Poong's effort to regain control.

In anticipation of the upcoming annual general meeting scheduled for late March, Young Poong and MBK Partners are preparing to nominate 17 candidates for the board of directors. By leveraging their voting power, they aim to restore robust corporate governance at Korea Zinc, a move crucial for enhancing shareholder value and overall corporate health.

A spokesperson for Young Poong stated, "This ruling is pivotal for us as it allows us to reaffirm our rights as shareholders while simultaneously promoting transparency and fairness in the corporate governance of Korea Zinc." This sentiment reflects the strategic importance of the decision as it reinforces the stakeholders’ commitment to uphold corporate values and drive growth.

As the next steps unfold, stakeholders of Korea Zinc will be closely monitoring the outcomes of the upcoming annual general meeting, which will set the tone for the future direction of the company. With tensions regarding governance at an all-time high, the decisions made inside the shareholders’ room could redefine the landscape of corporate governance in the region. Young Poong and MBK Partners’ proactive stance is expected to create a ripple effect across other firms facing similar governance challenges, highlighting the critical role of shareholder engagement in shaping corporate policy.

This court ruling serves as a reminder of the importance of transparent practices within corporate governance frameworks and the need for equitable treatment of all shareholders. As the stakes rise, all eyes remain on how the upcoming board elections will pan out, ensuring that democratic principles in corporate decision-making are upheld despite previous attempts to silence significant voices in the room.

The anticipated changes not only aim to empower Young Poong and MBK Partners but stand to inspire broader changes within the industry, promoting more democratic practices in corporate governance moving forward.