Youngone ends four-year arbitration dispute over Scott shares

South Korean apparel manufacturer Youngone Corporation has concluded a four-year international arbitration dispute over its acquisition of shares in Swiss premium sports brand Scott Corp., securing a 96.71 percent stake and resolving uncertainty over its governance, according to an industry source on Friday.

The International Chamber of Commerce arbitral tribunal issued its final award on Oct. 19, setting the final purchase prices for the acquired shares and ending a dispute that began in September 2022.

The dispute began after Youngone filed an ICC arbitration against Beat Zaugg, Scott’s second-largest shareholder, alleging that he had materially breached the shareholders’ agreement signed in 2015, when Youngone acquired controlling interest in Scott.

In its first award in 2025, the arbitral tribunal confirmed that Zaugg had materially breached the shareholders’ agreement and confirmed Youngone’s call option to acquire his Scott shares. The tribunal also ordered Zaugg to pay liquidated damages pursuant to the shareholders’ agreement and dismissed his counterclaim in its entirety.

Following the award, Youngone's board resolved on Feb. 6, 2025, to exercise the call option. After completing the share valuation process, the company acquired all 5,837,500 Scott shares held by Zaugg on Dec. 17, 2025, raising its stake in Scott to approximately 96.71 percent.

At the time, Youngone placed a portion of the share purchase price in an escrow account, pending the outcome of subsequent arbitration proceedings.

The final award determined Youngone had no obligation to make any additional payment to Zaugg, allowing the company to recover the full escrow. All payments related to the share acquisition have now been settled.

Youngone Vice Chair Sung Rae-eun was closely involved in the arbitration proceedings and share acquisition process, according to industry sources. She is said to have traveled to Switzerland on multiple occasions to oversee local operations and lead efforts to complete the transaction successfully.

Youngone worked with South Korean law firm Kim & Chang and Swiss law firm L&S throughout the four-year arbitration proceedings.

With the legal dispute and related financial settlement concluded, Youngone has resolved uncertainty surrounding Scott’s governance.

Youngone is planning to continue investing in Switzerland, where Scott is headquartered. Scott is known for high-performance bicycles featuring proprietary suspension technology and lightweight designs.

Youngone’s continued investment is also expected to strengthen Scott’s technological capabilities and product competitiveness while contributing to job creation in Switzerland.