The $1.7 billion takeover brawl fueled by a fear of China
Subscribe to enjoy similar stories. It is a bruising ownership fight in South Korea over the world’s largest zinc smelter. Fueling the dispute: fears the company could one day fall into China’s hands.
On one side is the 50-year-old Korea Zinc, led by Yun B. Choi, chairman and grandson of the co-founder, with officials arguing South Korea’s industrial strength is under siege. On the other is a South Korean private-equity firm headed by the country’s second-wealthiest individual, Michael ByungJu Kim, who has joined forces with the family of the other co-founder.
At the center of the dispute is Korea Zinc’s Onsan smelter in the city of Ulsan, South Korea, and the firm’s proprietary technologies. It is arguably a crown jewel of American hopes of creating a supply chain independent of China, which accounts for roughly half of the world’s refined zinc. Korea Zinc says it is asking Washington for backup.
Korea Zinc’s co-founders were friends turned business partners, who hailed from the same province in what is now North Korea. The firm’s name in Korean, Koryo Ayeon, uses a centuries-old name for the Korean state. Korea Zinc produces raw materials for cars, electric-vehicle batteries and semiconductors.
Kim, who is worth roughly $10 billion and moonlights as a fiction writer, sits atop his eponymous MBK Partners. He and his Seoul-based private-equity firm had long been praised locally for dealmaking prowess in South Korea. It owns a handful of Chinese companies and has a small contingent of Chinese investors.
MBK, emphasizing its overwhelming ties and investments within both Korea and Japan, has promised to not sell Korea Zinc to the Chinese. That pledge hasn’t toned down the rhetoric from Korea Zinc and its allies. They have
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