MBK Partners: Over USD 50M of Korea Zinc Funds Poured into Same Entertainment Firms Backed by Direct

Korea Zinc corporate funds funneled via OneAsia concurrently or in lockstep just days to months after personal stakes were acquired by Choi’s family
Over USD 50M+α (KRW 69B+α) pumped into four unlisted companies unrelated to core business… Claiming “GP’s independent decision” is an absurd excuse
Suspicions of private profit-taking by propping up personal investment risks with corporate funds… An independent audit committee member must be appointed at the September 9 shareholders’ meeting

 Young Poong and MBK Partners (hereinafter "the Consortium"), the largest shareholder of Korea Zinc, stated on the 28th that funds managed by OneAsia Partners (hereinafter “OneAsia”)—predominantly capitalized by Korea Zinc—injected over USD 50 million (KRW 69 billion) into four unlisted entertainment and content companies unrelated to Korea Zinc’s core business, the exact same firms in which Korea Zinc Executive Director Yun Birm Choi and his family had personally invested.

The Consortium pointed out that Director Choi’s explanation attributing these moves to the “independent investment decisions of the general partner (GP)” is wholly unconvincing.

According to criminal case records, regulatory filings, and Securities and Futures Commission minutes obtained by the Consortium through a shareholder derivative suit, Korea Zinc committed approximately USD 415 million (KRW 560 billion) to OneAsia—a newly established firm with zero track record, where Korea Zinc served as the sole LP in 6 out of 8 funds.

OneAsia subsequently executed over USD 50 million (KRW 69 billion) in follow-up investments into four entertainment entities, including Arc Media, High-Hat, and Slingshot Studio. Transaction logs confirm that OneAsia’s funds injected substantial capital either concurrently or just tens of days to a few months after Director Choi, his private investment vehicles, and relatives acquired convertible bonds (CBs).

In the case of Arc Media, just 42 days after Director Choi acquired USD 1.3 million (KRW 1.7 billion) in CBs under his personal name in May 2020, OneAsia’s Korea Growth No. 1 Fund (financed by Korea Zinc) acquired the remaining USD 18.5 million (KRW 25 billion) in its entirety. At the time, Choi’s side was the largest stakeholder, holding approximately 45% upon conversion. In July 2021, OneAsia and Choi’s family again split and acquired additional CBs either on the exact same day or within a 15-day window.

Similarly, in Slingshot Studio, OneAsia funneled capital into the company following initial CB acquisitions by Jericho No. 1 (a private investment partnership tied to Choi) and his cousins. On June 7, 2023, Jericho No. 1 (USD 2.2 million / KRW 3 billion) and the OneAsia fund (USD 3.7 million / KRW 5 billion) moved in lockstep, splitting and acquiring CBs on the very same day.

The Consortium stated, “There is undeniable evidence that Director Choi’s family secured personal positions first, followed by massive injections of Korea Zinc’s corporate capital into the exact same targets to prop up enterprise value and extract private gains. Claiming that Director Choi—who served as CEO at the time—was unaware of these synchronized transactions, or that they were merely independent GP decisions, is an attempt to mislead shareholders.”

The Consortium added, “The essence of this matter is not a mere failure of investment judgment, but severe allegations of breach of trust and misappropriation of corporate assets by offloading personal investment risks onto the company and its shareholders. As the incumbent audit committee has remained entirely silent, a truly independent audit committee member must be elected at the upcoming extraordinary general meeting on September 9 to restore shattered internal controls.”