Young Poong, MBK Allege Private-Gain Scheme by Korea Zinc CEO Family

Young Poong and MBK Partners have accused the Korea Zinc executive team, specifically CEO Choi Yoon-beom and his family, of engaging in a scheme that used company funds for personal gain. This alleged scheme involved investing in unlisted companies where the Choi family had already made investments, leading to potential financial benefits.

The dispute stems from the flow of funds from Korea Zinc to other companies, with Young Poong and MBK asserting that Korea Zinc executives bore unnecessary risks that should have been shouldered by the Choi family personally. The consortium claims that One Asia Partners, funded by Korea Zinc, made six investments totaling 69 billion won ($49.73 million) in three companies, but later found that the total investment exceeded this amount in four entertainment and content companies.

The group believes this structure represents a misuse of corporate funds for private gain and a breach of fiduciary duty. They argue that Korea Zinc should have been personally responsible for these risks rather than spreading them across shareholders. Young Poong and MBK also criticize Korea Zinc's characterization as a victim in a criminal case, arguing that the alleged losses were due to Choi's pursuit of private interests.

They call for an independent investigation into these allegations and suggest that if Korea Zinc suffered losses, the board and audit committee should have immediately examined the situation. The dispute is set to be discussed at an extraordinary shareholders meeting on Sept. 9, where the consortium aims to appoint independent audit committee members to restore internal control systems and protect shareholder rights.