SEOUL : A South Korean court struck down on Wednesday a request by zinc producer Young Poong to block Korea Zinc from buying back its own shares to counter Young Poong’s tender offer, the Seoul Central District Court said.Last month, Young Poong and private equity fund MBK Partners launched a 2 trillion won ($1.5 billion) tender offer for shares in Korea Zinc. They raised the offer to 2.3 trillion won last week.
Korea Zinc, which is the world’s top refined zinc producer,welcomed Wednesday’s court decision which it said will help fend off a “hostile” takeover attempt. It added that it is holding a board meeting on Wednesday to discuss a proposal to buy back shares.
Since it was founded in 1949, Young Poong Group has been run by family members of the two founders of the company, who were born in North Korea. But a management battle has been brewing between family members in recent years.
Young Poong, known for its bookstore chains in Korea, also produces zinc used in cars, home appliances and buildings and makes parts for smartphones and chip packaging for Samsung Electronics <005930.KS> and other customers.
Jerico Partners, a special purpose company established by the Korea Zinc chairperson and his family, also made a tender offer to buy 25 per cent of shares of affiliate Young Poong Precision for 118 billion won on Wednesday. This is in response to the offer by rival MBK to buy shares in the pump and valve maker, which holds a minor stake in Korea Zinc.
