South Korea’s NPS Withholds Vote on Korea Zinc Chairman Choi’s Board Reappointment

Korea Zinc Chairman Choi Yun-beom speaks during a session at the World Economic Forum in Davos. [Photo=Korea Zinc]

The National Pension Service, seen as a swing voter in Korea Zinc’s management-control dispute, has decided not to exercise its voting rights on a proposal to reappoint Chairman Choi Yun-beom as an inside director.

The NPS fund’s Stewardship Responsibility Committee said on the 20th it made the decision at its fifth meeting the previous day, ahead of Korea Zinc’s shareholders meeting on the 24th. The committee decided not to vote on the company-backed director nominees Choi Yun-beom, Hwang Deok-nam and Park Byeong-uk. It also decided to vote against the election of audit committee members Kim Bo-young and Lee Min-ho.

The NPS said the decision reflected that the nominees fall under those with a record of damaging corporate value or infringing on shareholder rights. On proposals to elect directors through cumulative voting — “Election of five directors” and “Election of six directors” — it decided to vote in favor.

For voting rights allocated through cumulative voting, the NPS said it will split its votes evenly by proposal sponsor: half for candidates proposed by Young Poong, YPC and Korea Corporate Investment Holdings — Choi Yeon-seok (outside non-executive director), Choi Byeong-il and Lee Seon-suk (outside directors) — and half for Walter Field McLellan (outside non-executive director), proposed by Crucible JV.

The NPS holds 5.20% of Korea Zinc and has been viewed as a key swing vote in the proxy fight. Choi and the Young Poong-MBK alliance are each reported to have secured friendly stakes of around 40%.

In response, Korea Zinc said it respects the NPS’s “strategic direction” in exercising voting rights and will use the outcome as momentum for the company’s continued growth.

Korea Zinc said the NPS recommended approval for most agenda items, including amendments to the articles of incorporation supported by the board and approval of the financial statements. It added that the NPS showed strong support by exercising half of its cumulative-voting rights for the Crucible JV nominee, which the company said carries symbolic meaning tied to its U.S. smelter project.

The company said the decision reflects recognition that the U.S. smelter construction being pursued by current management and the board is significant for growth, corporate value and shareholder value, and described the NPS decision as balanced and neutral, taking into account factors including greater board diversity.

* This article has been translated by AI.

Lee nakyeong