Korea / Special Situations, Clepsydra Capital

Sanghyun Park

Korea / Special Situations

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Event-Driven

<ul>
<li>A unique clause caps any single subscriber, including related parties, to 3% of the total issuance, or 111,979 shares, limiting MBK and Choi’s camp.</li>
<li>While there are legal risks regarding breach of duty, the capital raise is solid and unlikely to face immediate shutdown despite potential court challenges from MBK.</li>
<li>There are trading opportunities as 20% of shares are newly issued, potentially opening the door for MBK's tender offer and attracting new shareholders, including arb hunters.</li>
</ul>


A unique clause caps any single subscriber, including related parties, to 3% of the total issuance, or 111,979 shares, limiting MBK and Choi’s camp.
While there are legal risks regarding breach of duty, the capital raise is solid and unlikely to face immediate shutdown despite potential court challenges from MBK.
There are trading opportunities as 20% of shares are newly issued, potentially opening the door for MBK's tender offer and attracting new shareholders, including arb hunters.


Breaking Down the Details of Korea Zinc’s Shocking Capital Raise

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

<ul>
<li>Korea Zinc announced that it has secured 9.85% of its own shares through a public offering. Bain Capital also secured an additional 1.41% stake in Korea Zinc.</li>
<li>After this tender offer, MBK/Young Poong alliance still has a slight advantage. The fight for the control of Korea Zinc will likely be determined at the AGM in spring, 2025.</li>
<li>For longer term investors (with investment horizon of 1 year or more), the current share price of Korea Zinc looks overly stretched. </li>
</ul>


Korea Zinc announced that it has secured 9.85% of its own shares through a public offering. Bain Capital also secured an additional 1.41% stake in Korea Zinc.
After this tender offer, MBK/Young Poong alliance still has a slight advantage. The fight for the control of Korea Zinc will likely be determined at the AGM in spring, 2025.
For longer term investors (with investment horizon of 1 year or more), the current share price of Korea Zinc looks overly stretched. 


Korea Zinc: Increased Volatility in Share Price Post Korea Zinc's Tender Offer Results

<ul>
<li>This December’s KOSPI 200 shuffle will highlight stocks likely to see strong passive flows from changes in float rates.</li>
<li>Ecopro Materials sees BRV offloading shares, weakening its major shareholder status. Korea Zinc might mirror the Hankook &amp; Company scenario, bundling both families' stakes and treasury for non-float rate calculations.</li>
<li>The passive impacts may be small compared to constituent changes, but less dilution from proactive positioning means the price impact could be more noticeable as the effective date approaches.</li>
</ul>


This December’s KOSPI 200 shuffle will highlight stocks likely to see strong passive flows from changes in float rates.
Ecopro Materials sees BRV offloading shares, weakening its major shareholder status. Korea Zinc might mirror the Hankook &amp; Company scenario, bundling both families' stakes and treasury for non-float rate calculations.
The passive impacts may be small compared to constituent changes, but less dilution from proactive positioning means the price impact could be more noticeable as the effective date approaches.


KRX Float Rates for KOSPI 200 Constituents as of Today: Watch the Float Change Stocks

<ul>
<li>There's still 13.67% of neutral votes up for grabs, sparking market chatter about a fresh tender. But Choi is focusing on reviving voting rights for treasury shares.</li>
<li>MBK stated today that Korea Zinc's 9.85% treasury shares might not be canceled and could be sold to employee stock ownership plans (ESOPs).</li>
<li>MBK may ramp up open market buying sooner and more aggressively than expected, likely already impacting Korea Zinc's stock price starting today.</li>
</ul>


There's still 13.67% of neutral votes up for grabs, sparking market chatter about a fresh tender. But Choi is focusing on reviving voting rights for treasury shares.
MBK stated today that Korea Zinc's 9.85% treasury shares might not be canceled and could be sold to employee stock ownership plans (ESOPs).
MBK may ramp up open market buying sooner and more aggressively than expected, likely already impacting Korea Zinc's stock price starting today.


Korea Zinc's Buyback Results and Price Actions from Potential Sale of 9.85% Treasury to ESOP

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>
<strong><a href="https://www.smartkarma.com/entities/korea-zinc-co-ltd" target="_blank" data-smartkarma-citation="entities:17944:1" rel="noopener">Korea Zinc (010130 KS)</a></strong>, in tandem with Bain Capital, <a href="https://englishdart.fss.or.kr/dsbh001/main.do?rcpNo=20241028000007" target="_blank" rel="noopener">purchased 11.26% of KZ</a>, lifting Choi Yoon-beom's stake, together with friendly hands, to ~35.4%, compared to MBK Partners-Young Poong consortium's 38.47%. </li>
<li>Preceding my comments on KZ and <strong><a href="https://www.smartkarma.com/entities/young-poong-precision-corp" target="_blank" data-smartkarma-citation="entities:16188:1" rel="noopener">Young Poong Precision (036560 KS)</a> </strong>are the current setup/unwind tables for Asia-Pacific Holdcos.</li>
<li>These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.</li>
</ul>



Korea Zinc (010130 KS), in tandem with Bain Capital, purchased 11.26% of KZ, lifting Choi Yoon-beom's stake, together with friendly hands, to ~35.4%, compared to MBK Partners-Young Poong consortium's 38.47%. 
Preceding my comments on KZ and Young Poong Precision (036560 KS) are the current setup/unwind tables for Asia-Pacific Holdcos.
These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.


StubWorld: Korea Zinc's Public Tender & Expected EGM

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)

Breaking Down the Details of Korea Zinc’s Shocking Capital Raise

This post dives into the details of Korea Zinc’s shocking capital raise announced this morning and breaks down what it all means from a trading...

Sanghyun Park

KRX Float Rates for KOSPI 200 Constituents as of Today: Watch the Float Change Stocks

KOSPI 200 December Rebalancing: Constituent changes are as predicted, but it's important to pay attention to the stocks with float changes.

Sanghyun Park

Korea Zinc's Buyback Results and Price Actions from Potential Sale of 9.85% Treasury to ESOP

This post covers Korea Zinc's buyback tender results and touches on stock price actions likely driven by the potential sale of the 9.85% treasury...

Sanghyun Park

StubWorld: Korea Zinc's Public Tender & Expected EGM

YPP is "cheap" on a implied stub angle; however YPP is no longer in play. KZ gained a staggering 46% after the close of Choi/Bain's tender offer. I...

David Blennerhassett

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Breaking Down the Details of Korea Zinc’s Shocking Capital Raise

This post dives into the details of Korea Zinc’s shocking capital raise announced this morning and breaks down what it all means from a trading...

Sanghyun Park

Korea Zinc: Increased Volatility in Share Price Post Korea Zinc's Tender Offer Results

Korea Zinc announced that it has secured 9.85% of its own shares through a public offering. Bain Capital also secured an additional 1.41% stake in...

Douglas Kim

KRX Float Rates for KOSPI 200 Constituents as of Today: Watch the Float Change Stocks

KOSPI 200 December Rebalancing: Constituent changes are as predicted, but it's important to pay attention to the stocks with float changes.

Sanghyun Park

Korea Zinc's Buyback Results and Price Actions from Potential Sale of 9.85% Treasury to ESOP

This post covers Korea Zinc's buyback tender results and touches on stock price actions likely driven by the potential sale of the 9.85% treasury...

Sanghyun Park

StubWorld: Korea Zinc's Public Tender & Expected EGM

YPP is "cheap" on a implied stub angle; however YPP is no longer in play. KZ gained a staggering 46% after the close of Choi/Bain's tender offer. I...

David Blennerhassett