By Hyunjoo Jin, Cynthia Kim and Kane Wu

SEOUL (Reuters) -A takeover battle over Korea Zinc is adding pressure on Seoul to pass legislative reforms to ensure better protections for all investors in a country with a stock market dominated by family-run conglomerates.

Korea Zinc Chairman Yun B. Choi, a grandson of a co-founder, last week agreed to scrap a controversial plan to issue new shares in the world’s largest zinc refiner to help fend off a takeover attempt from the co-founding family’s Youngpoong Corp and its partner, private equity group MBK Partners.

The share issue plan had infuriated many investors, as two days before it was announced, Korea Zinc finalised a buyback at a 25% higher price.

Choi backed down after a regulatory probe and intense shareholder pressure that brought international attention to corporate governance shortcomings in Asia’s fourth-largest economy.

But Korea Zinc’s actions under his leadership have fuelled scepticism over whether the government’s call for voluntary efforts by companies to boost depressed stock valuations is sufficient, according to interviews with more than a dozen investors, governance experts, regulators and lawmakers.

After Choi became chairman in 2022, Korea Zinc signed deals with LG Chem and Hanwha Corp (KS:00088K) to invest in each other, in an arrangement known as a cross-shareholding, though it sold shares in the latter this month to help repay debt. Under Choi, it also sold stock to strategic partners including Hyundai Motor (OTC:HYMTF) Group and Trafigura.

“Why do you use company funds, not your own money to increase your control?” asked Park Yoo-kyung, a managing director at Netherlands-based APG Asset Management, who noted Korea Zinc could have formed joint ventures or used other types of contracts.

Many companies in Japan are unwinding cross-shareholding deals, which have been criticised as negative for corporate governance because they can insulate management from having to meet the interests of shareholders.

Korea Zinc said the cross-shareholdings were needed to ensure stable partnerships as it expanded into battery materials, hydrogen and other businesses.

Hahm Yong-il, senior deputy governor of the Financial Supervisory Service, said Korea Zinc’s moves had fuelled investor doubts about board independence.

The regulator’s commitment to reforming and improving capital markets is being tested, said Hahm, whose agency is investigating allegedly unfair practices in Korea Zinc’s proposed share issue plan even after it was cancelled.

LEGISLATION PUSH

Korea Zinc’s actions show legislation is needed to protect the interests of minority shareholders and address the lack of board independence, particularly at family-run conglomerates known as chaebols, said the people interviewed by Reuters.

In South Korea, board members have a fiduciary duty to perform their duties in the company’s interests, but not to safeguard shareholders’ interests.

The Democratic Party, which has a majority in parliament, on Tuesday proposed a commercial law revision to extend the duty to shareholders, saying the Korea Zinc saga added urgency to long-delayed legislation.

But President Yoon Suk Yeol’s People Power Party and business groups have raised concerns that the legislation would hurt businesses.

A South Korean business association that includes conglomerates like Samsung (KS:005930) and Hyundai as members, though not Korea Zinc, issued a statement on Thursday warning businesses could be subject to shareholder lawsuits and attacks from “speculative” overseas funds if the law was amended.

Yoon can veto bills, and his office this month took a step back from its earlier positive stance on the commercial law changes.

In January, Yoon had pledged to address the so-called “Korea discount” to shore up support from the country’s more than 10 million retail investors, taking a leaf from Japan’s corporate governance reforms over the last few years that have drawn interest from global investors and sent Tokyo stocks to record highs this year.

The Korea discount refers to a tendency for South Korean companies to have lower valuations compared to their overseas peers due to low dividend payouts and the dominance of chaebols that often have weak governance practices.

Benchmark KOSPI index shares traded at a price-to-book multiple of 0.87 as of Wednesday, below an average of 1.2 for companies on Japanese exchanges and 4.8 for the S&P 500 in the U.S., according to data from the exchanges.

FIRST HOSTILE TAKEOVER

Korea Zinc’s Choi pledged to give up his role as chairman of the board and come up with measures to protect minority shareholders as he braces for a showdown with Youngpoong and MBK at a shareholder meeting early next year.

Their bid for control, if successful, would be the first hostile takeover of a South Korean company by a private equity fund, and should serve as a wake-up call for chaebols, according to LSEG data.

“What MBK is doing on Korea Zinc could potentially spur dozens of similar disputes at some 200 locally listed Korean companies,” said Mike Cho, a business school professor at Seoul’s Korea University.

The country has traditionally been a tough ground for activist investors such as Elliott, which over the last decade made unsuccessful attempts to block deals at Samsung affiliates and Hyundai Motor Group companies.

The number of activist campaigns annually in South Korea grew more than nine-fold between 2019 and 2023, according to Diligent Market Intelligence, though the outcomes have been mixed.

“There is a buzz among local capital market players that MBK’s deal with Korea Zinc could be a game changer,” said Sanghyun Park, an analyst at Clepsydra Capital. “It’s seen as a key step to tackle the Korea discount by shaking up ownership structures.”

By Ankur Banerjee

SINGAPORE (Reuters) – Asian equities fell on Thursday after AI darling Nvidia (NASDAQ:NVDA) disappointed investors with a subdued revenue forecast, while the dollar firmed and bitcoin hit a record high in anticipation of U.S. President-elect Donald Trump’s proposed policies.

Prevailing geopolitical concerns following the escalating conflict in Ukraine earlier this week led safe-haven assets higher, including gold and government bonds.

The spotlight though was on earnings from the world’s most valuable firm Nvidia, which projected its slowest revenue growth in seven quarters, sending its shares lower. Nasdaq futures slipped 0.47%, while S&P 500 futures eased 0.3%.

MSCI’s broadest index of Asia-Pacific shares outside Japan eased 0.23%, with tech heavy Taiwan stocks down 0.5%. Japan’s Nikkei fell 0.7%.

George Boubouras, head of research at Melbourne-based K2 Asset Management, said the market reaction to Nvidia’s earnings was partly a result of very high expectations for each quarterly result. “While they delivered impressive revenue growth and momentum, the market clearly wants more.”

Charu Chanana, chief investment strategist at Saxo, said Nvidia earnings were a clear indication that the momentum in AI was only extending, with supplies being the bigger headwind rather than demand.

“The structural AI tailwind could continue to be a key driver for equities into the next year.”

Elsewhere in Asia, stocks in China opened a shade lower, while Hong Kong’s Hang Seng fell 0.22% at the open as the market remains rangebound even as some global funds follow domestic money into market segments sheltered from tariffs.

Investor focus will also be on Indian conglomerate Adani Group after U.S. prosecutors said on Wednesday that Gautam Adani, billionaire chair of the group, has been indicted in New York over his role in an alleged multibillion-dollar bribery and fraud scheme.

Dollar bond prices for Adani companies fell sharply in early Asia trade on Thursday.

SOARING DOLLAR

The dollar has been on the rise since the U.S. election in early November on anticipation that proposed tariffs of the incoming Trump administration will likely be inflationary and keep rates higher for longer.

The dollar index, which measures the U.S. currency against six rivals, was at 106.56, not far from the one-year high of 107.07 it touched last week. The index has risen more than 2% since the Nov. 5 election. [FRX/]

The prospect of the Federal Reserve having to temper its rate cut cycle has also boosted the dollar. Markets were pricing in the Fed lowering borrowing costs by 25 basis points next month at 56%, down from 82.5% just a week ago, according to CME’s FedWatch Tool.

Two Federal Reserve governors on Wednesday laid out competing visions of where U.S. monetary policy may be heading, with one citing ongoing concerns about inflation and another expressing confidence that price pressures will continue to ease.

The rise in the dollar has led the Japanese yen back into intervention territory, leading to verbal warnings from officials. On Thursday, the Asian currency strengthened a bit and was last at 155.04 per dollar.

Bitcoin has been on a tear since the election as the Trump administration are expected to relax regulations and be crypto friendly.

The world’s largest cryptocurrency, bitcoin, soared to touch a record of $95,040 in early trading and was last at $94,787.

In commodities, supply concerns triggered by escalating geopolitical tensions amid the ongoing war between Russia and Ukraine led oil prices higher.

Brent crude futures for January rose 0.5% to $73.17, while U.S. West Texas Intermediate crude futures for January gained 0.5%, at $69.11.

Gold prices were on the rise for fourth straight session on safe asset demands. Spot gold rose 0.15% at $2.654 per ounce. [GOL/]

By Renju Jose

SYDNEY (Reuters) – Australia’s centre-left government on Thursday introduced a bill in parliament that aims to ban social media for children under 16 and proposed fines of up to A$49.5 million ($32 million) for social media platforms for systemic breaches.

Australia plans to trial an age-verification system that may include biometrics or government identification to enforce a social media age cut-off, some of the toughest controls imposed by any country to date.

The proposals are the highest age limit set by any country, and would have no exemption for parental consent and no exemption for pre-existing accounts.

“This is a landmark reform. We know some kids will find workarounds, but we’re sending a message to social media companies to clean up their act,” Prime Minister Anthony Albanese said in a statement.

The opposition Liberal party plans to support the bill though independents and the Green party have demanded more details on the proposed law, which would impact Meta Platforms (NASDAQ:META)’ Instagram and Facebook, Bytedance’s TikTok and Elon Musk’s X and Snapchat.

But Albanese said children will have access to messaging, online gaming, and health and education related services, such as youth mental health support platform Headspace, and Alphabet (NASDAQ:GOOGL)’s Google Classroom and YouTube.

The Albanese-led Labor government has been arguing excessive use of social media poses risks to physical and mental health of children, in particular the risks to girls from harmful depictions of body image, and misogynist content aimed at boys.

A number of countries have already vowed to curb social media use by children through legislation, but Australia’s policy is one of the most stringent.

France last year proposed a ban on social media for those under 15 but users were able to avoid the ban with parental consent. The United States has for decades required technology companies to seek parental consent to access the data of children under 13.

“For too many young Australians, social media can be harmful. Almost two-thirds of 14 to 17-year-old Australians have viewed extremely harmful content online, including drug abuse, suicide or self-harm,” Communications Minister Michelle Rowland told parliament on Thursday.

The law would force social media platforms, and not parents or young people, to take reasonable steps to ensure the age-verification protections are in place.

The proposed law will contain robust privacy provisions, including requiring platforms to destroy any information collected to safeguard the personal data of users, Rowland said.

“Social media has a social responsibility … that’s why we are making big changes to hold platforms to account for user safety,” Rowland said.

($1 = 1.5356 Australian dollars)

By Maki Shiraki and Kantaro Komiya

TOCHIGI (Reuters) – Honda (NYSE:HMC) Motor aims to double the driving range of its electric cars by the late 2020s when they start to adopt all-solid-state batteries, a new type of power source under development, the head of its research unit said on Wednesday.

All-solid-state batteries, replacing liquid-state lithium-ion batteries, will produce twice the driving range by the end of this decade and over 2.5 times more by the 2040s, said Keiji Otsu, president of Honda R&D.

Automakers and battery suppliers worldwide have unveiled plans to develop solid-state batteries, touted as a key technology to make longer-lasting, safer and cheaper electric vehicles amid slowing EV growth.

“It’s a game-changer of the EV era,” Otsu told reporters at Honda’s pilot all-solid-state battery production line in Tochigi north of Tokyo. Honda is investing 43 billion yen ($277 million) in the pilot line, nearly half of which is funded with Japanese government subsidies.

Honda will start operating the pilot line in January, with goals also to reduce battery size by 50%, weight by 35% and cost by 25% from current levels in the next half decade, Otsu said.

Honda plans to increase its annual EV production to over 2 million units by 2030. It also targets a global sales ratio of 40% for EVs and fuel cell vehicles in 2030, and 100% in 2040.

Nissan (OTC:NSANY) Motor, Honda’s strategic partner, is also developing all-solid-state batteries, aiming to start the operation of its pilot line in March.

“There may be areas where we can work together,” Otsu said, suggesting the possibility of joint materials procurement.

Honda has “no reason to refuse” the external sale of its solid-state batteries if that is mutually beneficial to it and partners, Otsu added.

Toyota Motor (NYSE:TM), the world’s biggest automaker by sales, is looking to commercialise all-solid-state batteries in 2027-2028 in partnership with oil refiner Idemitsu Kosan.

($1 = 155.2800 yen)

SINGAPORE (Reuters) – Bitcoin‘s march toward $100,000 made further ground on Thursday as investors bet a friendlier U.S. regulatory approach to cryptocurrencies under President-elect Donald Trump will unleash a boom era for the asset class.

Bitcoin prices topped $95,000 for the first time in Asia trade, touching a high just above $95,040.

The cryptocurrency’s price has more than doubled this year and is up about 40% in the two weeks since Trump was voted in as the next U.S. president and a slew of pro-crypto lawmakers were elected to Congress.

“While it’s now firmly into overbought territory, it is being drawn toward the $100k level,” said IG Markets analyst Tony Sycamore.

Trump embraced digital assets during his campaign, promising to make the United States the “crypto capital of the planet” and to accumulate a national stockpile of bitcoin.

More than $4 billion has streamed into U.S. listed bitcoin exchange-traded funds since the election. This week, there was a strong debut for options on BlackRock (NYSE:BLK)’s ETF, with call options – bets on the price going up – more popular than puts.

Crypto-related stocks have been soaring along with the bitcoin price and shares in bitcoin miner MARA Holdings were up nearly 14% overnight, while MicroStrategy, a loss-making software company that has been buying bitcoin, rose 10% to take its market capitalisation beyond $100 billion.

“Many are wondering if this administration will bring the regulatory clarity the crypto community has been waiting for. It’s likely too soon to say,” said Will Peck, head of digital assets at WisdomTree, a global exchange-traded fund issuer.

“We see all of this excitement as bullish not only for bitcoin or crypto broadly, but the entire blockchain-enabled ecosystem that is growing today.”

By Stephen Nellis and Aditya Soni

SAN FRANCISCO/BENGALURU (Reuters) – Nvidia (NASDAQ:NVDA)’s revenue forecast on Wednesday disappointed Wall Street, raising questions over whether the artificial intelligence boom is waning. But the answer, according to Nvidia executives, analysts and investors, is a resounding no.

There is no shortage of companies eager to create new AI systems using Nvidia’s superior chips, and the world’s largest publicly listed company is selling them as fast as its chipmaking contractor Taiwan Semiconductor Manufacturing Co can make them.

Nvidia forecast its slowest revenue growth in seven quarters on Wednesday, pushing its stock down 2.5% after hours, and said supply chain constraints would lead to demand for its chips exceeding supply for several quarters in fiscal 2026.

Making these chips is hard, and a flaw that was found in one of its chips over the summer is not helping.

Nvidia’s new flagship chip, named Blackwell, is actually made up of multiple chips that have to be glued together in a complex process the chip industry calls advanced packaging. While TSMC is racing to expand capacity, packaging remains a bottleneck for Nvidia and other chip companies.

“Blackwell adds more advanced packaging from TSMC than prior chips, which adds a wrinkle,” said Ben Bajarin, CEO and principal analyst at research firm Creative Strategies. He expects Nvidia will have more demand than it can supply for all of 2025.

Missteps by Nvidia have exacerbated the issues.

The design flaw in Blackwell forced Nvidia to undertake what it calls a “mask change.” CEO Jensen Huang said the flaw, which has since been fixed, lowered Blackwell chip yields, which are the proportion of chips that come off the manufacturing line fully functional.

While Nvidia never elaborated on the flaw, complex chips like Blackwell can take months to produce because they require hundreds of manufacturing steps. Many of these steps involve shining ultraviolet light through a series of complex masks to project the image of a chip’s circuits on a disc of silicon – a process akin to printing the chip.

The mask change appears to have set back Nvidia’s production timelines and cost it money, analysts said.

“There’s the risk that the bottlenecks worsen rather than improve, and that could damage revenue projections,” said Michael Schulman, chief investment officer at Running Point Capital.

During a conference call with investors, Nvidia executives said the company has shipped about 13,000 samples of its new chip and expects to beat its initial estimates that it would sell several billion dollars’ worth this quarter.

“We’re at the beginning of our production ramp, which always comes with opportunities for yield improvement,” Huang told Reuters on Wednesday. “We are ramping Blackwell from zero to something extremely large. By definition, the laws of physics would say that there’s a limit to how fast you can ramp.”

In the short term, the production ramp-up is expected to pressure gross margins.

Nvidia executives warned investors the company’s margins would sink several percentage points to the low-70% range until production kinks are ironed out.

Hendi Susanto, a portfolio manager at Gabelli Funds, which holds Nvidia shares, said there was no doubt that demand for the company’s chips remained “absolutely and exceptionally strong” for the foreseeable future.

“The key focus is supply – how much supply Nvidia can produce,” he said.

(This story has been refiled to add Bengaluru to the dateline)

Investing.com– Most Asian stocks fell on Thursday as earnings from market major Nvidia provided middling cues, while Indian markets were squarely in focus after the U.S. accused conglomerate Adani of corruption. 

Regional markets took few cues from a muted overnight session on Wall Street, as caution over NVIDIA Corporation (NASDAQ:NVDA) kept investors to the sidelines. But U.S. stock index futures sank in Asian trade, tracking an over 1% aftermarket drop in Nvidia.

Heightened tensions over Russia and Ukraine also kept overall risk appetite limited. 

Asia tech skittish as Nvidia offers mixed signals 

Technology-heavy Asian bourses mostly fell on Thursday, although stocks with direct exposure to Nvidia were a mixed bag as its results offered differing cues. The TOPIX index shed 0.3%.

The world’s most valuable listed company clocked stronger than expected earnings in the September quarter. But its guidance for the current quarter just barely scraped past expectations, pointing to slowing revenue growth and sparking some fears that artificial intelligence demand had potentially peaked. 

Japan’s Nikkei 225 index shed 0.7%, with chip stocks Advantest Corp. (TYO:6857) and Tokyo Electron Ltd. (TYO:8035)n both losing ground.

South Korea’s KOSPI rose 0.2%, buoyed by small gains in Nvidia supplier SK Hynix Inc (KS:000660), which said it had begun production of advanced flash memory chips. Peer Samsung Electronics Co Ltd (KS:005930) rose 0.5%.

Taiwan shares of TSMC (TW:2330) (NYSE:TSM)- the world’s biggest contract chipmaker and a major Nvidia supplier- fell 1%, while those of Hon Hai Precision Industry Co Ltd (TW:2317), also known as Foxconn (SS:601138), lost nearly 2%. 

Nvidia is considered as a bellwether for AI demand, with its underwhelming guidance sparking some concerns that tech valuations had overestimated just how much of an earnings driver the industry will remain. 

Weakness in Asian tech spilled over into other sectors. Hong Kong’s Hang Seng index shed 0.2%, with shares of Semiconductor Manufacturing International Corp (HK:0981), China’s biggest chipmaker, trading sideways.

China’s Shanghai Shenzhen CSI 300 and Shanghai Composite indexes fell around 0.3% each, while Australia’s ASX 200 fell 0.1%. 

Indian stocks head for weak open on Adani charges 

Futures for India’s Nifty 50 index pointed to a weak open on Thursday, with shares of firms under Adani expected to tumble after a U.S. court accused Chairman Gautam Adani of an over $250 million bribery scheme. 

Shares of listed companies under the conglomerate- most notably Adani Enterprises Ltd (NS:ADEL) and Adani Ports and Special Economic Zone Ltd (NS:APSE)- are set to tumble when markets open on Thursday, given the U.S. allegations echo those leveled by short seller Hindenburg Research in early-2023. Adani shares had lost more than $100 billion in a matter of days after the Hindenburg report, although they have since recouped these losses.

 Multiple media reports said Adani Green Energy Ltd (NS:ADNA) had also scrapped a planned bond issuance in the wake of the allegations. 

Weakness in Adani is expected to drive down broader Indian stocks, which were already nursing steep losses over the past month as foreign investors withdrew from the country. The Nifty was in correction territory after sinking more than 10% from its September record highs, and hit a five-month low on Wednesday. 

By Miho Uranaka and Sam Nussey

TOKYO (Reuters) – Bain-backed Kioxia will have a market value of about 750 billion yen ($4.84 billion) based on the indicative price for its initial public offering, with the chipmaker to receive listing approval from the Tokyo bourse on Friday, two sources said.

The market value, which Reuters is reporting for the first time, could change depending on the final price in the IPO.

Kioxia, Bain and the Tokyo Stock Exchange declined to comment. The sources declined to be named as the information is not public.

Bain Capital scrapped plans for an IPO of Kioxia in October after investors pushed the buyout firm to almost halve the 1.5 trillion yen valuation it was seeking, Reuters has reported.

Kioxia is the first to choose to operate under new rules in Japan that allow companies to file a registration statement and communicate with investors before receiving listing approval.

Kioxia, formerly Toshiba (OTC:TOSYY) Memory, is targeting a December IPO, Reuters has reported. Bain postponed a previous IPO plan for Kioxia four years ago.

Going public would offer Kioxia fundraising options in a capital intensive industry but increase scrutiny on the company’s financials.

A Bain-led consortium acquired the chipmaker from scandal-hit conglomerate Toshiba for 2 trillion yen in 2018.

Shareholders including Bain will sell shares in the IPO, the sources said.

Morgan Stanley (NYSE:MS), Nomura and BofA Securities are joint global coordinators for the IPO.

($1 = 155.0400 yen)

Investing.com– Gautam Adani, Chair of the eponymous Indian conglomerate, was indicted with seven other men by a New York court on Wednesday on charges of a massive bribery scheme and for allegedly misleading investors. 

Adani, who is among the world’s richest men, was accused of having paid Indian government officials over $250 million in bribes to obtain solar energy supply contracts that were expected to generate over $2 billion in profits. 

The bribes were paid between 2020 and 2024- a period that was also marked by a sharp increase in Adani’s wealth.

Shares of firms under the Adani Group- which include Adani Ports and Special Economic Zone Ltd (NS:APSE) and Adani Enterprises Ltd (NS:ADEL)- had also risen sharply in valuation over the past four years. Adani Enterprises is the flagship company of the conglomerate.

The allegations come more than a year after short seller Hindenburg Research leveled allegations of fraud and market manipulation against the conglomerate. The Hindenburg report had sparked investigations by Indian and U.S. authorities, although Adani faced little scrutiny in India. 

Hindenburg alleged that India’s securities regulator also had ties to Adani. 

Wednesday’s indictment was announced by the U.S. Attorney’s Office of the Eastern District of New York. 

“The defendants orchestrated an elaborate scheme to bribe Indian government officials to secure contracts worth billions of dollars and Gautam S. Adani, Sagar R. Adani and Vneet S. Jaain lied about the bribery scheme as they sought to raise capital from U.S. and international investors,” U.S. Attorney Breon Peace said in a statement. 

The investigation into Adani involved the Department of Justice and the Federal Bureau of Investigation. The indictment also alleged that the defendants had attempted to hide the fraud by obstructing the government’s investigation into the case. 

Bloomberg reported that Adani’s units had scrapped a $600 million bond sale after the U.S. charges.

Adani could not be immediately reached for a comment.

SINGAPORE (Reuters) -Dollar bond prices for Adani companies fell sharply in early Asia trade on Thursday after the Indian conglomerate’s billionaire chairman was indicted in New York over allegations of bribery and fraud.

Prices for Adani Port and Special Economic Zone debt maturing in August 2027 fell more than five cents on the dollar, according to LSEG data.

Adani Electricity Mumbai debt maturing in February 2030 fell nearly eight cents and dollar bonds issued by Adani Transmission also notched falls larger than five cents to trade just above 80 cents.

The price falls were the biggest since February 2023 when short-seller Hindenburg Research published a negative report, questioning the group’s debt levels and use of tax havens.

U.S. authorities said on Wednesday that Adani Group Chairman Gautam Adani and seven other defendants agreed to pay about $265 million in bribes to Indian government officials.

Adani Group did not immediately respond to requests for comment outside business hours in India.

Shares in India-listed Adani companies begin trade at 0345 GMT.