South Korean Court Clears Korea Zinc’s U.S. Smelter Project

Post by : Saif Nasser

A South Korean court has rejected a request by two major shareholders to block Korea Zinc’s plan to issue new shares for a $7.4 billion smelter project in the United States. This ruling clears the way for the company to move forward with its U.S. expansion, sending Korea Zinc shares up nearly 5%, while shares of YoungPoong fell almost 10%.

The Tennessee-based smelter is a strategic project aimed at helping the United States reduce dependence on China for minerals used in electronics, chips, and defense equipment. Korea Zinc plans to sell $1.9 billion in shares to a joint venture controlled by the U.S. government and strategic investors. This investment will give the U.S. partners about a 10% stake in the South Korean firm.

MBK Partners and YoungPoong, which together own roughly 46% of Korea Zinc, expressed concerns over shareholder dilution and fairness of the deal. Despite the court decision, both companies said they intend to support the U.S. smelter project, hoping it will benefit the United States, Korea Zinc, and the South Korean economy.

The project may also strengthen the position of Korea Zinc Chairman Yun B. Choi. Since last year, Choi has been in a power struggle with MBK Partners and YoungPoong. Issuing shares to U.S.-linked investors could tip the balance of control in Choi’s favor.

Korea Zinc says the smelter project aligns with U.S. goals to diversify mineral supply chains and provides the company with a foothold in the world’s largest market for critical minerals. Experts view this move as a step toward long-term global growth and industrial collaboration.

Overall, the court ruling removes a major legal obstacle for Korea Zinc. The project is expected to enhance the company’s international presence, support U.S. industrial objectives, and create new opportunities for the South Korean economy.