Exclusive
Dongwon Industries Sells Entire 0.04% Stake in Korea Zinc Amid 'Management Dispute'

[비즈한국] It has been confirmed that Dongwon Industries006040 has sold its entire 0.04% stake in Korea Zinc010130. Korea Zinc's stock price surged last year amid a management control dispute. It is expected that Dongwon Industries realized a significant profit from the sale of its Korea Zinc stake.

In November 2022, Dongwon Industries acquired 8,834 shares of Korea Zinc (a 0.04% stake) for approximately 5.7 billion won. This purchase was made at roughly 640,000 won per share. At the end of 2022, Korea Zinc's stock price hovered between the high 500,000 won range and the low 600,000 won range. At the time, there was gossip that they had purchased the shares at an expensive price based on market rates.

However, as the management dispute flared up in the second half of last year, Korea Zinc's stock price skyrocketed. It rose to as high as 2,407,000 won in December last year. Since then, it has declined and is currently trading in the high 600,000 won to low 700,000 won range. This is still a higher level than when Dongwon Industries made the purchase.

According to BizHankook's coverage, it was confirmed that Dongwon Industries sold all of its Korea Zinc shares in two batches in October and December of last year. The specific sale price was not disclosed. Considering the trend of Korea Zinc's stock price, it is highly likely that they succeeded in realizing capital gains.

Dongwon Industries initially purchased the Korea Zinc stake for investment purposes. A 0.04% stake does not have a significant impact on management rights. However, with Chang Hyung-jin, advisor to Young Poong000670, and Korea Zinc Chairman Choi Yun-beom engaged in a dispute over management control last year, both sides were in a situation where they needed to secure every possible ally.

Dongwon Industries has never officially stated its position regarding the Korea Zinc management dispute. However, in the business world, it was presumed to be an ally of Chairman Choi Yun-beom. Ultimately, Dongwon Industries did not exert influence on Korea Zinc's management and instead sold the shares to realize profits. Korea Zinc held its general shareholders' meeting to appoint directors in January of this year, after Dongwon Industries had already sold its stake.

In addition to Korea Zinc, Dongwon Industries has invested in a number of companies, including OCI Holdings010060, OCI, ST Pharm237690, Choil Aluminum, and JTBC. Among these, Korea Zinc is the only one whose shares were sold off last year. However, stocks such as OCI and ST Pharm currently have share prices lower than their purchase price.

A representative from Dongwon Industries stated, "The very purpose of acquiring the Korea Zinc stake was a simple investment, so we sold it to realize investment profits."