Korea Zinc said Tuesday that MBK Partners and Young Poong should apologize for causing confusion among shareholders and in the market after the two companies decided to drop their lawsuit seeking to nullify resolutions passed at Korea Zinc's extraordinary shareholder meeting held in January last year.
In a statement released Tuesday, Korea Zinc said the explanation from MBK and Young Poong — that "the practical benefit of the lawsuit has disappeared" — falls far short of accounting for why a prolonged legal dispute was closed without a ruling on the merits, or for the uncertainty that shareholders and the market endured throughout the process.
Korea Zinc said MBK and Young Poong had initially challenged multiple agenda items passed at the extraordinary shareholder meeting, including a stock split, but later narrowed the scope of their claims during the proceedings. It added that the two companies then turned around and re-submitted the stock split — the very item they had opposed and sought to overturn — as a shareholder proposal at this year's annual general meeting, displaying a lack of consistency.
"They filed a lawsuit, then reduced their claims, ultimately withdrew the suit, and then proposed the very agenda item they had opposed back at a shareholder meeting — a pattern that has repeatedly caused confusion for shareholders and the market while amplifying uncertainty in corporate management," Korea Zinc said. The company added that what MBK and Young Poong owe first is an apology to shareholders and the market for burdening Korea Zinc's operations and stoking uncertainty.
Korea Zinc also said that if the court's recommended settlement is finalized, all legal disputes over the validity of the extraordinary shareholder meeting resolutions will be resolved and those resolutions will be confirmed as legally valid. The company said it would continue to respond firmly to one-sided allegations and PR campaigns by MBK and Young Poong, and would work to block their hostile takeover attempt.
Meanwhile, MBK and Young Poong said Tuesday that they had informed the court of their intention to withdraw the lawsuit after concluding they had achieved all the goals for which it was filed, and that the court issued a recommended settlement decision on Thursday accordingly.
If no party raises an objection within the statutory period, the decision will be finalized and carry the same legal effect as a court-mediated settlement.
Korea Zinc plans to hold an extraordinary shareholder meeting on Sept. 9 to vote on an amendment to its articles of incorporation to expand the number of separately elected audit committee members, the appointment of four directors by cumulative voting, and the selection of an independent director to serve on the audit committee.
likehyo85@heraldcorp.com
