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Photo courtesy of Yonhap News |
[Alpha Biz= Kim Jisun] Allegations have emerged that Korea Zinc Chairman Choi Yoon-beom and former One Asia Partners CEO Ji Chang-bae misused approximately 20 billion KRW (about USD 15 million) of company funds, though Korea Zinc has dismissed the claims as false and signaled legal action.
On December 14, Youngpoong issued a statement asserting that “Chairman Choi and former CEO Ji appear to have diverted Korea Zinc funds through a roundabout route to recover investment in Cheongho Comnet and realize personal profits,” adding that “a thorough investigation is needed to verify the appropriateness of fund usage and potential breach-of-trust charges.”
According to Youngpoong, Choi’s 99.9%-owned entity, Yeorigo No.1 Association, acquired shares in Cheongho Comnet, where Ji held a 31.4% stake, via off-market share purchases and third-party allotments in September–October 2019, making Yeorigo the company’s third-largest shareholder with a 6.2% stake. On March 12, 2020, Cheongho Comnet sold its subsidiary Se-Won to a company named SWNC for 20 billion KRW.
Youngpoong alleges that SWNC’s funding effectively originated from Korea Zinc, claiming the company lent 20 billion KRW to SWNC using Se-Won shares as collateral. Following the subsidiary sale, Cheongho Comnet’s stock price surged from the 2,000 KRW range to around 8,000 KRW, allowing Ji’s side to profit significantly from selling their holdings.
The report further claims that the “loaned funds” were ultimately repaid using Korea Zinc money. SWNC repaid the loan in early 2021, at which point Ji’s Arbitrage No.1 private equity fund invested 25.5 billion KRW in SWNC, much of which Youngpoong alleges came from Korea Zinc as a limited partner.
Korea Zinc has denied all allegations and indicated it will pursue legal remedies to defend its reputation.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
