Korea Zinc Co. Ltd. will buy back 3.2M shares at 830,000 South Korean won per share in an attempt to fend off private equity firm MBK Partners’ takeover attempt, the company stated in a report by S&P.
The treasury tender offer is equivalent to a 15.5% stake and is valid from 4 October through to 23 October, Korea Zinc said in an email to S&P Global Commodity Insights.
Private equity company Bain Capital LP plans to invest about 430B won in the tender offer to acquire 2.5% of the total issued shares, the company said.
“We’ve also decided to cancel all treasury stocks acquired through tender purchases to defend our management right and enhance shareholder value,” Korea Zinc said.
MBK and Young Poong Precision Corp., Korea Zinc’s largest shareholder, recently improved their bid to acquire an additional 14.72% stake in Korea Zinc to about US$1.7B from US$1.5B. MBK’s offer lasts until 4 October 2024.
Korea Zinc chairman Choi Yun-beom has met with executives of the company’s business partners as part of “last-ditch efforts” to stop MBK from acquiring an additional stake in the company, The Korea Times reported23 September, citing industry sources.
Choi is trying to drum up support from local and foreign partners, including Japan’s SoftBank Corp. and Sumitomo Corp., as well as Hanwha Corp., which holds a 7.76% stake in Korea Zinc, the sources said.
Young Poong holds a 33% stake, whereas Korea Zinc and the family that owns it collectively hold 18%, the report said.
