KB News Desk
Private equity firm highlights Project Crucible as Homeplus struggles to secure emergency funding
MBK Partners is facing criticism after hosting a reception in the United States to promote Korea Zinc’s US investment project while its portfolio company Homeplus remains mired in a deepening restructuring crisis in South Korea.
The event took place on July 9 in Nashville, Tennessee, where MBK and Young Poong introduced themselves as Korea Zinc’s “largest shareholder group” and highlighted their support for Project Crucible, the zinc producer’s flagship US investment project, according to industry sources Wednesday.
Attendees included MBK Vice Chairman Yoon Jong-ha, executives from MBK and Young Poong, representatives of US lobbying firms and local business figures. MBK also reportedly showcased its global investment portfolio and presented its investment philosophy through a corporate video.
The reception came as Homeplus suspended operations at stores nationwide after running short of operating funds following a court decision earlier this month to terminate its corporate rehabilitation proceedings.
The Seoul Bankruptcy Court ruled on July 3 that Homeplus’ liquidation value exceeded its going-concern value. Unless the retailer secures 200 billion won ($134 million) in debtor-in-possession financing by July 17, industry officials say it could enter liquidation.
A scheduled meeting Tuesday between MBK Vice Chairman Kim Kwang-il and the Homeplus labor union was also postponed after MBK informed the union earlier in the day that it would reschedule the talks. The union had planned to press MBK to secure the emergency financing and appeal the court’s decision to terminate the rehabilitation proceedings.
Political pressure has also intensified. The National Assembly’s Political Affairs Committee is considering a parliamentary hearing into MBK’s handling of Homeplus, while lawmakers have urged the National Pension Service to review its investments in, and business relationship with, the private equity firm.
The US event also drew attention because Project Crucible was conceived and developed by Korea Zinc’s current management under Chairman Choi Yun-beom. MBK and Young Poong had previously opposed the company’s plan to finance the project through a third-party share issuance, arguing that it unfairly excluded major shareholders and lacked sufficient governance safeguards.
MBK told local media it has never opposed the strategic value of Project Crucible itself, but rather the proposed financing method and decision-making process. It also said the Homeplus restructuring and the Korea Zinc investment are separate matters that should not be linked.
Some industry observers, however, questioned both the timing of the event and the message it conveyed.
“MBK is facing multiple challenges at home, including Homeplus’ store closures, uncertainty over its restructuring, postponed talks with the labor union and growing political pressure,” one industry official said. “Against that backdrop, holding an event in the US highlighting its role in Korea Zinc’s flagship investment project was bound to attract attention.”
The official also noted that MBK and Young Poong presented themselves as key supporters of the project despite their earlier opposition to the capital raising tied to the investment.
“Project Crucible has been planned and advanced by Korea Zinc’s current management and technical team from the outset,” the official said. “Promoting themselves as representatives of the project without prior coordination with the company could be viewed as inconsistent with their previous position.”
