By Kwanwoo Jun


Korea Zinc's shares advanced after a consortium led by private-equity firm MBK Partners increased its stake in the company in a fight for control of the world's largest zinc smelter.

The stock was 2.5% higher at 813,000, around $599, in early Tuesday trading, off an intraday record of 831,000 won earlier. Seoul's headline stock index, the Kospi, was up 0.1%.

The rally came as the battle for control over Korea Zinc continues, with no decisive winners having emerged from initial competing offers.

MBK-backed Young Poong said in a regulatory filing late Monday it had secured another 5.34% of the South Korean nonferrous metal company in its Sep. 13-Oct.14 offer.

The additional stake will bring the MBK-Young Poong consortium's combined stake in Korea Zinc to more than 38%, missing its 47.7% target and well short of an absolute shareholder majority.

MBK said following the monthlong offer that it believed it had secured enough voting rights to express its views at future shareholder meetings. The buyout company then said it would focus on stopping Korea Zinc's ongoing share buyback.

Bain Capital-backed Korea Zinc, currently led by Yun B. Choi, chairman and grandson of its co-founder, has opposed the MBK-led offer and launched a share buyback to stop what it calls a hostile corporate takeover.

Korea Zinc last week increased its stock repurchase price by 7.2% to 890,000 won a share, above MBK's final offer of 830,000 won.

Korea Zinc also decided to buy back more shares than initially planned. The share buyback runs until Oct. 23.

Boston-based Bain Capital, which sides with the incumbent management, has agreed to purchase a 2.5% stake in Korea Zinc for 430 billion won.

MBK has legally challenged Korea Zinc's share buyback, financed heavily by loans, claiming that it would weaken the company's financial health.

Korea Zinc says it is committed to completing the share buyback, approved by a local court previously. It plans to then cancel the shares and improve shareholder returns.


Write to Kwanwoo Jun at kwanwoo.jun@wsj.com


(END) Dow Jones Newswires

10-15-24 0046ET