Titanic Battle for Korea Zinc: Family Feud Shakes Trillion-Dollar Empire

The bitter power struggle between two wealthy South Korean families over control of Korea Zinc has evolved into a spectacular drama that could impact the diversification of the global supply of energy transition metals. The Choi and Chang families, who originally co-founded the $11 billion zinc holding, are now locked in a dispute that is dominating the headlines. For months, tensions over strategy and spending have been simmering, reaching a boiling point in September. The Chang family's surprise takeover attempt, supported by Young Poong and private equity firm MBK Partners, made waves. The offer now values Korea Zinc at 15.5 trillion won ($11.6 billion). Press conferences and campaign ads further fueled the fire. This tug-of-war has also affected the London Metal Exchange meeting. Korea Zinc and Young Poong negotiated separately with suppliers and customers, marking a clear break from their previous joint negotiations. Both sides actively sought the support of their partners. Korea Zinc produces 12% of the world’s zinc outside of China, 5% of the lead, and roughly 9% of the silver. These metals are crucial for limiting China’s dominance in the metals sector. Zinc, used for galvanizing steel and in battery technologies, plays a key role in green energy supply. MBK Partners pledges to improve corporate governance at Korea Zinc. This could reduce the “Korea discount” for large companies, which has arisen due to a lack of transparency. However, the power struggle carries risks, including the possibility that the company might be broken up and sold to China. MBK has vehemently denied such plans. The current dispute dates back to the appointment of Choi Yun-beom as chairman at the end of 2022. He pushed for investments in “green materials,” while the rivals wanted to maintain strong dividends. These disagreements led to numerous legal conflicts and both sides increasing their stakes. The MBK-backed takeover attempt drove Korea Zinc shares to a record high of 747,000 won, but could not completely eradicate investor skepticism, as the improvement bids did not exceed 750,000 won per share.