Korea Zinc Chairman Choi Yun-beom at a press conference held at a hotel in central Seoul, Oct. 2. (Yonhap)

The current management of Korea Zinc on Friday decided to up the ante to maintain control over the world’s largest zinc smelter, lifting the tender offer price to 890,000 won ($660) per share, higher than 830,000 won presented by the coalition of MBK Partners and Young Poong.

While the current management of Korea Zinc, represented by Chairman Choi Yun-beom, initially targeted securing an additional 15.5 percent of the total issued shares, the target has been raised to 17.5 percent. Adding the 2 percent target set by US private investment giant Bain Capital, whom Choi has joined hands with, he could secure an additional 20 percent stake in the company.

With the decision, the tender offer plan will cost around 3.2 trillion won for Korea Zinc, up over 500 billion won from the previously budgeted 2.7 trillion won.

Jericho Partners, a special purpose company launched by the Choi family, raised the tender offer price for Korea Zinc’s affiliate Young Poong Precision from 30,000 to 35,000 won as well, according to a regulatory filing made Friday. This is also higher than the MBK-Young Poong coalition’s 30,000 won offer.

Owning a 1.85 percent stake in Korea Zinc, the affiliate is considered a key stakeholder in the proxy fight. With the target amount maintained at 25 percent, the tender offer budget for Young Poong Precision has been raised from 118 billion won to 138 billion won.

The MBK-Young Poong alliance attacked the price raise for Korea Zinc as a move that burdens the company’s finances.

“The board’s decision will negatively affect the company in a permanent way,” MBK said in a statement issued shortly after Korea Zinc decided to raise the bid price.

“Young Poong, the largest shareholder (of Korea Zinc) cannot accept that such a huge amount will be used to protect Choi. When things wrap up, Korea Zinc will be in debt of 2.7 trillion won. What will the company earn in return? Nothing.”

Korea Zinc is to pool 2.7 trillion won through corporate loans to fund the 3.2 trillion won offer.

Despite intensifying competition for management control, MBK announced Wednesday that it will not further raise the tender offer price for Korea Zinc, claiming additional price competition will only damage the corporate value of Korea Zinc and Young Poong Precision.

Wednesday's announcement came a few days after the Financial Supervisory Service expressed concerns about the heated price competition for Korea Zinc. FSS Gov. Lee Bok-hyun said the watchdog will keep a close look at the dispute as excessive competition could lead to market instabilities.

The share price of Korea Zinc stood at 794,000 won at 2 p.m. Friday, up 5,000 won, or 0.63 percent, from the previous trading day. Young Poong Precision shares traded at 29,000 won, marking a loss of 2,250 won, or 7.2 percent.