South Korea's local government says no to fund's takeover plan of Korea Zinc, stock purchase campaign also underway

The Ulsan City Council, in the name of 22 council members, expressed concern over the M&A (merger and acquisition) of Goryeo Zinc, a company that specializes in smelting and non-ferrous metals. Goryeo Zinc is a refinery located in Ulju County, Ulsan City.
MBK Partners (hereafter referred to as MBK Partners), a private equity (PE) firm specializing in investments in China, Korea, and Japan, has partnered with Chang Hyun Jin, an advisor at non-ferrous metals giant Yongpoong.
, MBK) began a public tender offer on the 13th to secure management control of Korea Zinc. As a result, MBK will increase its stake in Korea Zinc from 7% (1,445,036 shares) to 14.6% (
The plan is to increase the number of shares held by MBK and Yongpoong to 3,024,881. As a result, MBK and Yongpoong are expected to secure 47.7% of Korea Zinc's shares. City council members said, "If Korea Zinc becomes owned by Chinese capital through a hostile takeover,
"It will have a negative impact on Ulsan's employment market and market order. Speculation cannot promote or maintain employment. Korea Zinc's core technology will leak out and the rechargeable battery supply chain will collapse," they said.
Prior to this, Ulsan Mayor Kim Du-ryeom said, "We launched a campaign to purchase Korea Zinc shares and received cooperation from 1.2 million citizens."
On the other hand, some have pointed out that local governments are going a little too far in interfering in private company M&A.
As the movement to dismiss the chairman progresses, some analysts are saying that the situation will not change with the local government's hardline stance.