Korea / Special Sits, Pairs, Index Rebalancing, Clepsydra Capital

Sanghyun Park

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Event-Driven

<ul>
<li>NPS’s stake has dropped, and most minority shareholders are passive. NPS might oppose cumulative voting, so Choi’s chances of getting 67% support at the EGM on the 23rd are slim.</li>
<li>The showdown is between MBK’s 14 picks and Choi’s 7. Without cumulative voting, even with NPS’s shares, Choi’s chances of beating MBK are slim.</li>
<li>If you’re short on Korea Zinc, holding seems fine. Backwardation in Jan-Feb futures isn’t steep, so a new position before the EGM could also be worth a shot.</li>
</ul>


NPS’s stake has dropped, and most minority shareholders are passive. NPS might oppose cumulative voting, so Choi’s chances of getting 67% support at the EGM on the 23rd are slim.
The showdown is between MBK’s 14 picks and Choi’s 7. Without cumulative voting, even with NPS’s shares, Choi’s chances of beating MBK are slim.
If you’re short on Korea Zinc, holding seems fine. Backwardation in Jan-Feb futures isn’t steep, so a new position before the EGM could also be worth a shot.


NPS Stake in Korea Zinc Revealed: EGM Vote Locked, Short Play in Focus

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

<ul>
<li>Chairman Choi has proposed a cumulative voting system which is one of the agenda items to be discussed and voted upon at the EGM on 23 January. </li>
<li>There is likely to be continued uncertainty about proxy voting, including whether or not Korea Zinc could use cumulative voting system for Chairman Choi to retain control of the company. </li>
<li>On 23 December, Korea Zinc (010130 KS) announced that it will propose a 10 to 1 stock split on the next EGM scheduled for 23 January 2025.</li>
</ul>


Chairman Choi has proposed a cumulative voting system which is one of the agenda items to be discussed and voted upon at the EGM on 23 January. 
There is likely to be continued uncertainty about proxy voting, including whether or not Korea Zinc could use cumulative voting system for Chairman Choi to retain control of the company. 
On 23 December, Korea Zinc (010130 KS) announced that it will propose a 10 to 1 stock split on the next EGM scheduled for 23 January 2025.


Korea Zinc: Cumulative Voting System and 10 to 1 Stock Split

<ul>
<li>The EGM for Korea Zinc (010130 KS) is expected to be held on 23 January 2025. Accordingly, the shareholder registry is expected to be closed around 19 - 23 December. </li>
<li>By better analyzing the timeline of the M&amp;A of SM Entertainment, we may be able to get better clues to Korea Zinc's price movement in the next several weeks. </li>
<li>Notice the double top share price formation of SM Entertainment in 2023 versus the potential double top formation of Korea Zinc in 2024. These trading formations look eerily similar.</li>
</ul>


The EGM for Korea Zinc (010130 KS) is expected to be held on 23 January 2025. Accordingly, the shareholder registry is expected to be closed around 19 - 23 December. 
By better analyzing the timeline of the M&amp;A of SM Entertainment, we may be able to get better clues to Korea Zinc's price movement in the next several weeks. 
Notice the double top share price formation of SM Entertainment in 2023 versus the potential double top formation of Korea Zinc in 2024. These trading formations look eerily similar.


A Comparison of Korea Zinc's M&A in 2024 Vs SM Entertainment's M&A in 2023 in the 9th Inning

Equity Capital Markets

<ul>
<li>In this insight, we review the major rights offerings/capital raises that were announced in Korea in 2024.</li>
<li>In general, the major rights offerings/capital raises tend to result in lower share prices one month, three months, and over a longer time frame. </li>
<li>There are some exceptions. Peptron and ABL Bio experienced higher share prices even after their capital raise announcements, especially after a longer time frame (3 months or more).</li>
</ul>


In this insight, we review the major rights offerings/capital raises that were announced in Korea in 2024.
In general, the major rights offerings/capital raises tend to result in lower share prices one month, three months, and over a longer time frame. 
There are some exceptions. Peptron and ABL Bio experienced higher share prices even after their capital raise announcements, especially after a longer time frame (3 months or more).


A Review of Rights Offerings/Capital Raise Announcements in Korea in 2024

<ul>
<li><em><strong>There is likely to be a proxy fight for the control of Korea Zinc (010130 KS) between MBK/Young Poong alliance and Chairman Choi/Bain Capital alliance in January 2025. </strong></em></li>
<li>Young Poong Precision announced that it will acquire 39,254 shares of Korea Zinc. Post this purchase, Young Poong Precision will own a 2.11% stake in Korea Zinc (up from 1.92%).</li>
<li>FSS Governor Lee Bok-Hyun mentioned that the FSS is seriously reviewing a potential accounting issue related to environmental pollution at Young Poong.</li>
</ul>


There is likely to be a proxy fight for the control of Korea Zinc (010130 KS) between MBK/Young Poong alliance and Chairman Choi/Bain Capital alliance in January 2025. 
Young Poong Precision announced that it will acquire 39,254 shares of Korea Zinc. Post this purchase, Young Poong Precision will own a 2.11% stake in Korea Zinc (up from 1.92%).
FSS Governor Lee Bok-Hyun mentioned that the FSS is seriously reviewing a potential accounting issue related to environmental pollution at Young Poong.


A Proxy Fight for Korea Zinc in January 2025

South Korea

Korea Zinc Co., Ltd. specializes in non-ferrous metal smelting industry.  The Company manufactures zinc ingots, electrolytic gold, silver, lead, sulfuric acid, and copper.  Korea Zinc provides its products to domestic and overseas markets.

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Korea Zinc (010130 KS)

NPS Stake in Korea Zinc Revealed: EGM Vote Locked, Short Play in Focus

NPS backed cumulative voting and the director cap at Korea Zinc’s EGM. This is a win for Choi, and the pop today likely came from the news leaking...

Sanghyun Park

Korea Zinc: Cumulative Voting System and 10 to 1 Stock Split

National Pension Service (NPS) reduced its stake in Korea Zinc from 7.49% to 4.51%, according to FSS. NPS sold some of its shares (0.63 million...

Douglas Kim

A Comparison of Korea Zinc's M&A in 2024 Vs SM Entertainment's M&A in 2023 in the 9th Inning

December 18th is the last day to secure voting rights for Korea Zinc. MBK claims intrinsic value of Korea Zinc is 14 trillion won (680,000 won per...

Douglas Kim

A Review of Rights Offerings/Capital Raise Announcements in Korea in 2024

We review the major rights offerings/capital raises that were announced in Korea in 2024. In general, the major rights offerings/capital raises...

Douglas Kim

A Proxy Fight for Korea Zinc in January 2025

MBK mentioned that Korea Zinc should conduct a stock split instead of a capital increase to increase shares trading liquidity. MBK stated that if...

Douglas Kim

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