Korea Zinc Inc., the world’s top lead and zinc smelter, on Wednesday withdrew its 2.5 trillion won ($1.8 billion) rights issue as the move to secure more shares in a battle with MBK Partners Ltd., which is closer to winning, sparked protests from shareholders and prompted a regulatory probe.“The board of directors has determined that the most reasonable step is to protect shareholders, stabilize the market and restore shareholder confidence by humbly addressing shareholder concerns and responding to as many requests as possible,” Korea Zinc Chair Choi Yun-birm told reporters.
The FSS plans to continue its investigation even though Korea Zinc has dropped the plan.“We will separately investigate accounting supervision and unfair trading issues regardless of the company’s cancellation of the rights issue,” said an FSS official.“We are also probing issues raised by both Korea Zinc and Young Poong.”Korea Zinc said on Wednesday that the offering aimed at increasing trading volume, adding the company had not anticipated the regulatory move and shareholder concerns before the rights issue plan.
Choi on Wednesday pledged to step down as chairman of the board while promising other measures for shareholder value to regain investor confidence by boosting shareholder value.“I will step down as chairman of the board of directors as soon as possible to allow an outside director to become chair and strengthen the board's independence.”THE MAJORITY OF MINORITY VOTESHe said the company is considering revising its articles of incorporation to appoint a director for minority shareholders to allow decisions based on the majority of minority votes.
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