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>MBK is unlikely to lower the tender price or cancel the offer due to legal constraints and potential regulatory hurdles, along with compensating investors.</li>
<li>Just keep in mind that if you want to participate in MBK's Korea Zinc offer, you'll need to submit your bid to secure that compensation safety net.</li>
<li>We can’t rule out the second injunction request being accepted on the 21st, leaving Choi’s camp in a tough position with tender offer cancellation risks compared to MBK.</li>
</ul>


MBK is unlikely to lower the tender price or cancel the offer due to legal constraints and potential regulatory hurdles, along with compensating investors.
Just keep in mind that if you want to participate in MBK's Korea Zinc offer, you'll need to submit your bid to secure that compensation safety net.
We can’t rule out the second injunction request being accepted on the 21st, leaving Choi’s camp in a tough position with tender offer cancellation risks compared to MBK.


Korea Zinc: Breaking Down the Cancel Risk with Specific Legal Provisions for Both Camps

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

<ul>
<li>On 4 October, MBK Partners announced that it is raising its tender offer price of Korea Zinc from 750,000 won to 830,000 won, matching Choi family's tender offer price. </li>
<li>As the price and conditions have changed, the tender offer period for Korea Zinc by MBK Partners and Young Poong will be extended by 10 days until 14 October.</li>
<li>Unless the Choi family makes another counter offer, upping the tender offer price even further, MBK/Young Poong is in a better position to win this M&amp;A war for Korea Zinc.</li>
</ul>


On 4 October, MBK Partners announced that it is raising its tender offer price of Korea Zinc from 750,000 won to 830,000 won, matching Choi family's tender offer price. 
As the price and conditions have changed, the tender offer period for Korea Zinc by MBK Partners and Young Poong will be extended by 10 days until 14 October.
Unless the Choi family makes another counter offer, upping the tender offer price even further, MBK/Young Poong is in a better position to win this M&amp;A war for Korea Zinc.


MBK Raises Tender Offer Price of Korea Zinc to 830,000 Won

<ul>
<li>MBK ditched the hard floor, eliminating cancellation risk. With a 15% GGT rate, there’s a 4% spread, so if you can secure volume, the deal looks solid.</li>
<li>MBK's tender offer has less volume than Choi's buyback (18%), increasing proration risk, but Choi’s deal also faces legal headaches, leaving some cancellation risk.</li>
<li>Tax implications differ: MBK's offer incurs capital gains tax, while Choi’s buyback is subject to dividend tax. Foreign investors may prefer MBK’s 0% withholding tax, impacting participation.</li>
</ul>


MBK ditched the hard floor, eliminating cancellation risk. With a 15% GGT rate, there’s a 4% spread, so if you can secure volume, the deal looks solid.
MBK's tender offer has less volume than Choi's buyback (18%), increasing proration risk, but Choi’s deal also faces legal headaches, leaving some cancellation risk.
Tax implications differ: MBK's offer incurs capital gains tax, while Choi’s buyback is subject to dividend tax. Foreign investors may prefer MBK’s 0% withholding tax, impacting participation.


MBK Raised Korea Zinc's Tender Price to ₩830K and Dropped the Hard Floor, Keeping the Upper Hand

<ul>
<li>Korea Zinc plans to repurchase and cancel shares worth 2.663 trillion won. Korea Zinc's partner Bain Capital also plans to purchase around 430 billion won for a 2.5% stake. </li>
<li>Korea Zinc plans to buy back shares at 830,000 won per share, which is 11% higher than MBK's revised up tender offer price of 750,000 won.</li>
<li>Choi family/Bain Capital's efforts to conduct a massive share buyback and cancellation at higher prices than the market price goes against the globally accepted market practices.</li>
</ul>


Korea Zinc plans to repurchase and cancel shares worth 2.663 trillion won. Korea Zinc's partner Bain Capital also plans to purchase around 430 billion won for a 2.5% stake. 
Korea Zinc plans to buy back shares at 830,000 won per share, which is 11% higher than MBK's revised up tender offer price of 750,000 won.
Choi family/Bain Capital's efforts to conduct a massive share buyback and cancellation at higher prices than the market price goes against the globally accepted market practices.


Korea Zinc: Plans to Buy Back and Cancel Shares Worth 2.7 Trillion Won + Team Up with Bain Capital

<ul>
<li>Young Poong filed a criminal complaint against the board of directors of Korea Zinc (010130 KS) who voted in favor of the tender offer by buying back Korea Zinc's shares.</li>
<li>If Korea Zinc proceeds with the share buyback at higher price than the tender offer price by MBK, there are two main scenarios.  </li>
<li>Trading Action Point: If Uncertain, Watch the Price Action in the Next Several Days</li>
</ul>


Young Poong filed a criminal complaint against the board of directors of Korea Zinc (010130 KS) who voted in favor of the tender offer by buying back Korea Zinc's shares.
If Korea Zinc proceeds with the share buyback at higher price than the tender offer price by MBK, there are two main scenarios.  
Trading Action Point: If Uncertain, Watch the Price Action in the Next Several Days


Legal Chaos Amid Young Poong Filing a Criminal Complaint Against Korea Zinc's BOD and What's Next?

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)

Korea Zinc: Breaking Down the Cancel Risk with Specific Legal Provisions for Both Camps

This post outlines the specific legal provisions regarding cancellation risks for both camps vying for control of Korea Zinc.

Sanghyun Park

MBK Raises Tender Offer Price of Korea Zinc to 830,000 Won

On 4 October, MBK Partners announced that it is raising its tender offer price of Korea Zinc from 750,000 won to 830,000 won, matching Choi...

Douglas Kim

MBK Raised Korea Zinc's Tender Price to ₩830K and Dropped the Hard Floor, Keeping the Upper Hand

MBK bumped up the tender price for Korea Zinc to 830K KRW and scrapped the hard floor. This post explains why MBK’s still holding the upper hand.

Sanghyun Park

Korea Zinc: Plans to Buy Back and Cancel Shares Worth 2.7 Trillion Won + Team Up with Bain Capital

On 4 October, Korea Zinc announced that of the 2.7 trillion won of the buyback tender offer, 1.5 trillion won will be financed with internal funds....

Douglas Kim

Legal Chaos Amid Young Poong Filing a Criminal Complaint Against Korea Zinc's BOD and What's Next?

If Korea Zinc proceeds with the share buyback at higher price than the tender offer price by MBK, there are two main scenarios.

Douglas Kim

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Market Cap (USDm)

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