The announcement came as the company, backed by U.S. investment firm Bain Capital, strives to fend off a takeover bid from its largest shareholder, Young Poong, and MBK Partners.
The company's board approved the issuance of 3.73 million new common shares at 670,000 won per share, according to a regulatory filing.
Twenty percent of the new shares will be allocated to the company's employee stock ownership association, a move expected to boost the number of favorable shares.
Of the proceeds, 2.3 trillion won will be used to repay debt, and 135 billion won will go toward facility investments. The subscription period is scheduled for Nov. 3-4.
On Monday, Young Poong and MBK Partners requested an extraordinary shareholders' meeting to discuss new director appointments and management changes.
Korea Zinc Chairman Choi Yun-beom and Bain Capital recently acquired an 11.26 percent stake in the company through a tender offer that ended last Wednesday, while Young Poong and MBK Partners secured an additional 5.34 percent stake in a separate offer that ended Oct. 14.
The Korea Zinc-Bain alliance controls 35.4 percent of voting rights, while Young Poong-MBK holds 38.47 percent, setting up an intense battle for control ahead of the shareholders' meeting.
Korea Zinc was co-founded in 1974 by Byung-hee Chang and Ki-ho Choi. The Choi family currently manages the company, while the Chang family oversees Young Poong and its electronics affiliates.
Competition for Korea Zinc shares has intensified between the two families since Yun-beom Choi became chairman in 2022.
