Korea Zinc Warns of Growing U.S. Concerns Over MBK Partners’ Takeover Attempt

SEOUL, South Korea--(BUSINESS WIRE)--Several notable US House of Representatives members and other political figures have expressed concerns regarding MBK Partners’ attempted takeover of Korea Zinc (KRX:010130), the world's largest zinc smelter. They have raised alarms that this hostile takeover could expand China’s influence over critical mineral supply chains and pose risks to U.S. national security. The widespread concern over MBK’s attempted acquisition has been reported in local media such as The Korea Herald.

On March 5, Rep. Mariannette Miller-Meeks, a member of the U.S. House Committee on Energy and Commerce, sent a letter to Diane Farrell, the Acting Deputy Under Secretary for International Trade Administration at the U.S. Department of Commerce. In her letter, she urged the U.S. government to take action to counter China’s increasing control in the mineral and resource sectors.

Rep. Miller-Meeks, who shared the letter on her X account, underscored the need for the U.S. to secure independent and resilient supply chains by strengthening domestic mining and investing in partnerships with allies.

Directly addressing MBK’s takeover attempt, she warned, “I have been informed that China-linked entities are attempting to gain control over Korea Zinc through a hostile takeover attempt led by MBK Partners.”

She also highlighted Korea Zinc’s vital role in ensuring an independent supply chain, stating, “This is an industry dominated by China, and independent entities like Korea Zinc play a crucial role in supplying critical materials, including those now under China's export restrictions.”

Korea Zinc is a key global supplier of several rare metals—such as antimony, indium, tellurium, and cadmium—materials that China has recently placed under export restrictions. These metals are essential for semiconductor manufacturing, renewable energy, and defense industries, making them directly relevant to U.S. security interests.

The concerns raised by Rep. Miller-Meeks align with those previously expressed by Rep. Zach Nunn, who sent a similar letter to Farrell on February 19.

Rep. Nunn, in his letter posted on X, warned that, “If the Chinese Communist Party is successful in gaining influence over Korea Zinc, it will further China's control over critical mineral supply chains, heightening the risks of economic coercion and technology leakage.”

Additionally, former U.S. Representative Vin Weber echoed these concerns, warning that MBK’s investment history raises legitimate fears about China-affiliated entities gaining access through its transactions.

In a letter to Geoffrey Pyatt, Assistant Secretary of State for Energy Resources, Weber cautioned, “This could lead to both a widespread technology transfer to Chinese entities as well as the dismantling of an important global player in the joint United States-Korea effort to insulate and expand critical minerals supply chains away from the People’s Republic of China.”

The repeated warnings from U.S. lawmakers and policymakers reflect mounting concerns in Washington that MBK’s takeover bid could disrupt ongoing efforts to strengthen critical mineral supply chains in collaboration with key allies.

Meanwhile, the MBK-Young Poong alliance and Korea Zinc are awaiting a critical decision from the Seoul courts, which could have significant implications for the company's management.

MBK Partners has filed an injunction seeking to nullify the resolutions passed at Korea Zinc’s extraordinary shareholders' meeting, which reaffirmed Chairman Yun B. Choi’s leadership.

Concerns over MBK’s ability to responsibly manage Korea Zinc have only intensified throughout recent months, particularly given its track record that may show it prioritizes short-term financial gains over sustainable business operations. This issue has been further underscored by the recent corporate rehabilitation request filed by Homeplus, the hypermarket chain that MBK acquired in 2015.

At the time, MBK’s KRW 7.2 trillion (USD 5 billion) acquisition of Homeplus was the largest private equity buyout in Asia-Pacific history. However, the firm reportedly raised KRW 5 trillion from external sources to finance the deal, only to struggle with mounting financial costs, raising further doubts about its capacity to manage a complex and strategically vital business like Korea Zinc.