In the ever-shifting landscape of South Korea’s corporate boardrooms, few dramas have matched the intensity and complexity of the ongoing battle for control of Korea Zinc. As the company marks its 50th anniversary, its future remains clouded by legal wrangling, shareholder intrigue, and a global business pivot that’s as much about minerals as it is about management might.
The latest chapter unfolded on August 28, 2026, when the Supreme Court of Korea handed down a decision that reverberated through the country’s business community. The court upheld a lower court’s ruling that Korea Zinc’s move to restrict the voting rights of Youngpoong—its largest shareholder—at a January 2025 temporary shareholders’ meeting was illegal. According to Yonhap News, the ruling confirmed that the method Korea Zinc used to defend its management—namely, forming a circular shareholding structure via its Australian subsidiary, Sun Metal Corporation (SMC)—ran afoul of Korean law.
The roots of this legal saga stretch back to September 2024, when Youngpoong and private equity giant MBK Partners launched a public offer to buy Korea Zinc shares, aiming to wrest majority control from Chairman Choi Yoon-beom and his allies. Despite holding a smaller share—just 38.76% compared to Youngpoong and MBK’s combined 42.1% as of August 31, 2026—Choi managed to maintain his grip on management. How? Through a combination of cumulative voting, strategic alliances, and, as it turned out, some controversial legal maneuvers.
During the January 2025 temporary shareholders’ meeting, Korea Zinc transferred a 10.33% stake in Youngpoong (amounting to 190,226 shares) to SMC for 57.5 billion KRW in an over-the-counter deal. This move created a circular shareholding structure: Korea Zinc → SMC → Youngpoong → Korea Zinc. Under Article 369, Paragraph 3 of the Korean Commercial Act, if a company and its subsidiaries hold more than 10% of another company’s shares, the latter’s voting rights can be nullified. Korea Zinc leaned on this provision to block Youngpoong from exercising its votes.
But the courts saw it differently. The Seoul Central District Court ruled in March 2025 that SMC, being more akin to a limited company under Australian law, did not qualify as a subsidiary under the Korean Commercial Act. As a result, the restriction on Youngpoong’s voting rights was deemed illegal. Korea Zinc’s subsequent appeal was rejected, with the Supreme Court agreeing that SMC could not be considered a company “similar to a Korean stock company” for the purposes of the law. The legal foundation for Korea Zinc’s maneuver crumbled.
Youngpoong and MBK Partners were quick to claim victory. In a statement reported by Bizwatch, the alliance declared, “This decision is a clear judicial judgment that Chairman Choi Yoon-beom’s attempt to defend his management rights by leveraging overseas affiliates and forming a circular shareholding structure to restrict the largest shareholder’s voting rights was illegal.” They also argued that the ruling serves as a check on the use of complex affiliate structures for personal gain at the expense of shareholder democracy.
Yet, Korea Zinc pushed back on this interpretation. Company representatives stressed that the Supreme Court’s decision was narrowly focused on the legal status of SMC at the time of the temporary shareholders’ meeting. According to Korea Zinc, “The core of this decision is whether SMC can be regarded as a company similar to a Korean stock company under our Commercial Act. The court did not rule against our current governance or management system.” The company further argued that the ruling has no direct bearing on the Fair Trade Commission’s ongoing review of Korea Zinc’s use of overseas affiliates in circular shareholding arrangements—another regulatory cloud hanging over the firm.
Meanwhile, the boardroom chess match shows no sign of abating. The stage is now set for another pivotal showdown: the upcoming temporary shareholders’ meeting scheduled for September 9, 2026. This meeting will see the appointment of four new independent directors and an audit committee member, all under the cumulative and separate voting rules. The outcome could tip the balance of power on the board, where, as of now, Choi’s camp holds nine seats to Youngpoong and MBK’s five. If both sides secure two of the new independent directors, the board would stand at 11-7; if the audit committee seat goes to Choi’s side, it becomes 12-7, but if Youngpoong and MBK win it, the split is 11-8. Every vote counts, and with the “3% rule” limiting the voting power of the largest shareholders and related parties, institutional and minority shareholders will play a crucial role.
The management struggle has not been confined to the courtroom or the boardroom. The protracted dispute has had a profound impact on Korea Zinc’s business strategy and even its stock price. During the height of the conflict in 2024, Korea Zinc’s share price soared from 480,000 KRW at the start of the year to a dizzying 2,400,000 KRW by December, reflecting both market uncertainty and investor speculation. The company also began to diversify its business, moving beyond its traditional focus on non-ferrous metal smelting into key minerals and semiconductor materials—a shift prompted by China’s tightening export controls on critical minerals in 2024.
Perhaps the most significant strategic move came in December 2025, when Korea Zinc joined forces with the U.S. government to launch “Project Crucible”—a $7.4 billion (about 11 trillion KRW) investment to build an integrated smelting plant in Tennessee. This facility, roughly half the size of the company’s flagship Ulsan Onsan plant, is not just a business venture; it’s also a key pillar in Choi’s defense of his management. Project Crucible’s backers now hold a 10.6% stake in Korea Zinc and have secured a seat on the board, providing Choi with a powerful strategic ally.
As the September 9 meeting approaches, industry insiders are watching closely. One executive told Bizwatch, “Even if one side secures an advantage at this shareholder meeting, another showdown is likely at next year’s regular meeting, when the terms of eight directors and one audit committee member will expire. The Korea Zinc management war is entering a new phase.”
For all the intrigue, this is not just a story about boardroom battles or legal fine print. It’s about the future of one of Korea’s industrial giants, the shifting sands of global supply chains, and the delicate dance between shareholder rights and management ambition. As the dust settles from the Supreme Court’s ruling and the next round of voting nears, one thing is clear: the drama at Korea Zinc is far from over, and the outcome will shape the company—and perhaps the industry—for years to come.