Oct 3, 2024 - Business

Bain Capital enters the fight for South Korean metals giant

Dan Primack

Illustration of two hands pulling on either side of a rope with a hundred dollar bill tied in the middle — Illustration: Natalie Peeples/Axios

Bain Capital is supporting a share buyback plan by Korea Zinc, the world's largest refined zinc smelter, which is designed to prevent what it argues is a "hostile" takeover by MBK Partners.

The big picture: This is a bitter fight between the founding families of a $12 billion metals giant, each of which now has a deep-pocketed private equity firm on its side.

On one side is the Chang family, which recently partnered with MBK to launch a $1.5 billion tender offer to buy a control stake in Korea Zinc. That tender ends tomorrow.
On the other is the Choi family, which now plans to buy back $2 billion of Korea Zinc stock at an 11% premium to the Chang price. This is what Bain Capital is backing, via the purchase of another $322 million worth of shares.

Look ahead: The South Korean government would probably require that any future sale of Korea Zinc be to a domestic company, thus limiting exit opportunities for MBK.

Go deeper, via Bloomberg: "The battle and its aftermath will have implications far beyond Korea. Including affiliates, the company accounts for 12% of the world's zinc produced outside of China, 5% of its lead and around 9% of its silver. ... Those are vital for efforts to limit Beijing's metals dominance."

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Bain Capital enters the fight for South Korean metals giant

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