Korea ZincIn order to play a pivotal role in this national key industry and to further focus on fostering Korea’s national strategic industries, we are promoting the leap forward as a ‘national company’ through a paid-in capital increase through a general public offering to all citizens.
The purpose is to provide opportunities for various investors, including minority shareholders, institutional investors, and the general public, to participate as shareholders, thereby strengthening the transparency of corporate management through dispersion of ownership. To this end, we plan to establish a radically open governance and management structure to suit the distributed ownership structure for minority shareholders and the general public.
In addition, through general public capital increase, we have overcome the situation in which shares may be concentrated in certain shareholders after the tender offer, which may lead to continuous disputes, and thus we are able to increase the supply of key industrial materials such as zinc, lead, gold, silver, and copper, semiconductor sulfuric acid, indium, and cobalt. It also contains the will to ensure that there are no disruptions in the supply and quality maintenance of rare metals such as bismuth and antimony and other strategic mineral resources. This is part of an effort to minimize disruption to the domestic industrial ecosystem and side effects on the supply chain due to hostile M&As.
Korea Zinc’s board of directors held an extraordinary board meeting on the 30th, reported the results of the tender offer and requests for convening an extraordinary general meeting of shareholders, and decided to increase capital through general public offering as an agenda item.
Accordingly, Korea Zinc will later increase capital through general public offering, starting with a subscription notice. The total number of shares offered is 3,732,650, which is equivalent to 20% of the issued shares excluding treasury shares subject to cancellation acquired by Korea Zinc through a tender offer. The funds raised through this will be invested to foster national strategic industries such as secondary batteries, and some will also be used to repay debt.
Korea Zinc plans to first conduct a general public offering for 80% of the total offered shares and allocate the remaining 20% to the Employee Stock Ownership Association in accordance with the law.
In addition, within the legal scope, we plan to allocate only 111,979 shares, or 3% of the total number of shares offered, to all subscribers excluding employee stock ownership associations, including those with special interests. This is part of the drive to expand the shareholder base and become a national corporation. There are many actual cases in which per-person subscription limits are set during general public offering capital increase.
The issue price is the weighted arithmetic average stock price (total transaction amount divided by total transaction volume) from 3 to 5 transaction days before the subscription date as the base stock price, and the issue price is determined by applying a discount rate of 30% according to the limit of the issuance disclosure regulations. I plan to do it.
Korea Zinc expects to be able to create various positive effects through this capital increase through general public offering. ▲Establishment as a ‘people’s democracy’ through distributed ownership structure and expansion of shareholder base ▲Resolving stock price instability and protecting shareholders by resolving delisting risk due to reduced trading volume and increasing stock liquidity ▲Reducing risk of deletion from MSCI Korea index ▲Reducing risk of deletion from MSCI Korea index ▲Resolving delisting risk due to reduced trading volume Contributing to strengthening the foundation for sustainable growth and stabilizing the financial structure ▲Enhancing employee welfare and labor-management cooperation through the allocation of employee stock shares.
In fact, due to the recent hostile M&A between MBK Partners and Youngpoong, which resulted in a mutual tender offer, Korea Zinc’s distribution volume decreased significantly, causing the stock price to soar by more than 100% in 18 trading days and to 1,543,000 won as of the closing price on the 29th. There are significant side effects, including excessive intensification.
As a result, concerns about damage to investors due to delisting or management stock designation are growing, and efforts to resolve this are urgently needed. It is expected that this can be resolved through this general public offering.
In addition, Korea Zinc plans to use the funds secured through this capital increase to actively invest in fostering national strategic industries such as secondary batteries and use some of it to repay loans. The smooth supply of funds for the new business Troika Drive (▲renewable energy and green hydrogen ▲secondary battery materials ▲resource circulation business) promoted by Korea Zinc is expected to contribute to improving Korea Zinc’s long-term corporate value and expanding shareholder profits.
Lastly, through paid-in capital increase through a general public offering to the public, we prevent hostile M&A, resulting technology outflow, and furthermore, overseas sales of national key industries, thereby improving corporate value in the long term and all stakeholders, including executives and employees, partners, and the local community. We plan to be reborn as a true ‘national company’ by protecting the interests of the company.
