“Non-ferrous metals are fundamental materials used extensively across various industries including semiconductors, automobiles, and construction. This is why the non-ferrous metal smelting industry is recognized as a national key industry, and many related technologies are designated as national core technologies.
Korea Zinc is a global leader in non-ferrous metal smelting, producing the largest quantities of zinc, lead, silver, and indium worldwide. It is the only company in the world that operates an integrated zinc-lead-copper process and possesses the key capability to extract 12 kinds of rare and scarce metals contained in zinc and lead concentrates.
However, since last year, Korea Zinc has been the center of attention not for its titles and corporate value, but for the ‘management rights dispute’ with private equity firm MBK Partners and Young Poong Group.
The parent company of Korea Zinc, Young Poong Group, originated from ‘Young Poong Corporation,’ founded in November 1949 by co-founders Choi Ki-ho and Jang Byung-hee. This 76-year partnership, maintained through shared equities by the descendants of the co-founders, began to fracture last year when Korea Zinc transitioned to third-generation management.
The Choi family managed Korea Zinc, a core subsidiary of Young Poong Group, while the Jang family oversaw the entire Young Poong Group and its electronic affiliates. However, the dispute between the two families has been ongoing for several months, involving numerous lawsuits and defamation battles that exceed one’s ten fingers to count.
During this process, confidential business information has been repeatedly exposed, and as each party continues to discredit the other, some have become more interested in the company’s fluctuating stock prices than in the potential negative impacts on key industries.
In the era of global fierce competition, ‘brand image’ is just as crucial as technical capabilities. This is why there are concerns in the market about the negative effects that the management rights conflict between Korea Zinc, MBK, and Young Poong may have.
The dispute between both parties has now become a ‘chicken game’ where there are no winners and everyone suffers losses. The bigger issue is that this is not just a game for a few individuals. Thousands of employees, as well as partners and suppliers, are feeling anxious due to the Korea Zinc situation. The Korea Zinc labor union has declared that they will consider a general strike if a grand compromise fails, pledging to ‘protect their workplace and stable working environment.’
It’s time to step away from the ‘arena’ and move to the negotiation table. Korea Zinc’s recent initiative to extend an olive branch is a welcome move.
On the 24th of last month, Korea Zinc CEO Park Ki-deok proposed cooperation to MBK, stating, “Due to hostile mergers and acquisitions (M&A), all employees and their families in Korea Zinc and its affiliates, as well as partners and customers, are experiencing immense anxiety and pain.” He also publicly expressed willingness to include MBK-recommended personnel on the board and open up paths for management participation.
Now it’s MBK and Young Poong’s turn to respond. In a head-on collision, disaster is inevitable if neither party turns the wheel. The collapse of a ‘world no. 1’ domestic company will be the best opportunity and optimal scenario for global competitors.
Already, core technicians at Korea Zinc have declared that they will resign if MBK or Young Poong seizes management control. To avoid the domino effect of national core technology leaks and a general labor strike affecting the entire Korean industrial sector, it’s time to end the meaningless attrition battle.”