The World's Third-largest National Pension Service (NPS) Backs Korea Zinc's Management at EGM

The National Pension Service (NPS), the world's third-largest pension fund and Korea's representative public pension, has thrown its weight behind Korea Zinc's current management at the upcoming Extraordinary General Meeting (EGM). The NPS Trustee Responsibility Committee convened on the 17th and decided to support key agenda items proposed by Korea Zinc's management, including the introduction of a cumulative voting system and capping the number of directors at 19. This decision aligns with the recommendations of global proxy advisory firms like ISS and Glass Lewis, marking a clear affirmation of the stance that maintaining the current management structure is preferable.

The NPS's decision carries substantial significance, as it transcends a routine voting action and carries implications for consensus among industrial policy. Politicians from both ruling and opposition parties have emphasized the need to protect Korea Zinc, a key contributor to national industry. Members of the National Assembly's Industry Committee have pointed out the risks of technological leakage to countries like China, calling on the government to address the issue proactively. Concerns over the Korea Zinc situation have also been raised in U.S. political circles. U.S. Representative Eric Swalwell, co-chair of the Critical Minerals Caucus, sent an official letter to the Department of States expressing concerns that the China Investment Corporation (CIC) is among the key investors in MBK Partners. He urged an evaluation of the Korea Zinc situation in consideration of the shared national security interests of South Korea and the United States. Former White House National Security Advisor Robert O'Brien also warned in a media article of the risks of key mineral technologies being transferred to China if Korea Zinc is sold.



The NPS's decision reflects considerations beyond investment interests, likely reflecting broader national industrial policy concerns. As a major limited partner (LP) in MBK Partners, the NPS's decision carries implications for the broader business community and the future of Korea Zinc. Industry experts predict that this decision will serve as an important signal for future policies aimed at protecting domestic key industries. Considering the symbolic nature of the NPS as a public institution, this decision transcends a routine voting action and carries implications for consensus among industrial policy.

A Korea Zinc official stated, "This decision by the NPS recognizes the importance of Korea Zinc's sustainable development and technological competitiveness as a key component of national industry. We will continue to enhance shareholder value and contribute to national industrial development."

In conclusion, the NPS's decision to support Korea Zinc's management proposals at the upcoming EGM is a significant development in the ongoing control battle with Young Poong and MBK Partners. The NPS's decision aligns with the recommendations of global proxy advisory firms, reflects broader national industrial policy concerns, and carries implications for consensus among industrial policy. The cumulative voting system and board size cap could have significant implications for Korea Zinc's corporate governance and shareholder dynamics, potentially enhancing minority shareholder rights, disrupting the MBK-Young Poong alliance's takeover plans, and raising concerns from some institutional investors. The ultimate impact will depend on the outcome of the extraordinary general meeting and the broader political and economic context.