South Korea's largest industrial conglomerate just recruited the U.S. military as a co-owner, and the transaction flows in the opposite direction from every other critical-minerals nationalism story of the past two years.
In mid December, Korea Zinc, the world's largest zinc smelting company, agreed to sell $1.9 billion in newly issued shares to Crucible JV, a joint venture controlled by the U.S. Department of Defense and unnamed American strategic investors, including JPMorgan Chase. The transaction hands the Pentagon a 40 percent stake in Crucible JV, while Korea Zinc itself holds less than 10 percent of the venture. The proceeds, combined with $4.7 billion in loans from the U.S. government and financial institutions and $210 million in Commerce Department subsidies drawn from CHIPS and Science Act authority, will fund the first large-scale zinc refinery built on American soil since the 1970s. Total project cost: $7.4 billion. It is one of roughly 38 direct-ownership deals worth a combined $27.7 billion that Washington has struck since January 2025, according to the Council on Foreign Relations' U.S. Government Deal Tracker. But in nearly every other one of those deals, an American company sold a piece of itself to the U.S. government. Here, a foreign, publicly listed industrial titan is the one doing the recruiting.
The project, formally named Project Crucible, will rise in Clarksville, Tennessee, on the site of the only primary zinc smelter left in the United States. That smelter, operated by Nyrstar, a Trafigura subsidiary, was built in 1978 and has run for nearly five decades as the country's sole domestic source of refined zinc. Korea Zinc bought it, along with Nyrstar's East Tennessee and Mid Tennessee mining complexes, and completed that purchase on April 1, 2026, after clearing regulatory approvals. The old smelter will be torn down. In its place, Korea Zinc is building a 6.99 million square foot complex modeled directly on its Onsan refinery in Ulsan, South Korea, currently the largest single-site nonferrous smelter on Earth.
When fully operational in 2029, the Clarksville facility is expected to process 1.1 million tons of raw material annually and produce 540,000 tons of finished metal: 300,000 tons of zinc, 200,000 tons of lead, 35,000 tons of copper, and 5,100 tons of rare earth minerals, alongside gallium, germanium, indium, antimony, bismuth, tellurium, cadmium, silver, gold, and semiconductor-grade sulfuric acid. Eleven of those outputs sit on the U.S. government's list of 60 designated critical minerals. Korea Zinc says it can also recycle roughly 620,000 metric tons of smelting byproducts already stockpiled in five tailings ponds on the Clarksville site, material the company has valued at as much as $3 billion.
The deal did not close without a fight, and the fight had nothing to do with China. Korea Zinc has spent nearly two years locked in a control battle between Chairman Choi Yun-beom and an alliance of private equity firm MBK Partners and conglomerate Young Poong, which together hold roughly 44 to 46 percent of the company's shares. When Korea Zinc's board approved the Crucible JV share issuance on December 15, the MBK-Young Poong alliance immediately objected, arguing it was excluded from any meaningful briefing on a decision of that magnitude and calling it a governance breakdown. Korea Zinc's stock, which had spiked as much as 26 percent on news of the U.S. partnership, reversed and fell nearly 14 percent the next day as the alliance filed for a court injunction in the Seoul Central District Court, warning the share sale would dilute existing shareholders and cement Choi's grip on the company.
The alliance was not wrong about the dilution math. Once Crucible JV's stake closes, the MBK-Young Poong bloc's combined holding is expected to fall from about 44 percent to the high 30s, while shares friendly to Choi, including the new 10 percent held by the U.S.-backed venture, rise into the 40 percent range. On December 24, the Seoul court dismissed the injunction, clearing Korea Zinc to proceed. MBK and Young Poong, despite losing, said they would still support the smelter project for the sake of the broader U.S.-Korea relationship. But the underlying dynamic was unmistakable: a foreign national security transaction had just tipped the balance of a corporate control fight 6,000 miles from the Pentagon.
Young Poong put the interpretation bluntly in a public statement: Korea Zinc's management was simply securing a "white knight" so Choi could retain control, at a moment when it is genuinely rare for the U.S. government to take a stake in a foreign company at all. Whether or not that reading is fair, it points to something real about how these deals now get made. Washington's demand for domestic critical-minerals capacity has become leverage that a besieged foreign chairman can use in his own boardroom war, not just a tool the U.S. wields over dependent suppliers.
Korea Zinc had already been positioning itself as an indispensable American partner before the Tennessee deal. In August 2025, it struck an agreement with Lockheed Martin to supply germanium sourced outside China starting in 2028. It has separately agreed to help The Metals Company process polymetallic nodules from the seafloor. The Pentagon's willingness to become a 40 percent owner of Crucible JV is, in that light, the culmination of a courtship Korea Zinc had been running for over a year, aimed as much at Seoul boardrooms as at Washington policymakers.
The Trump administration's equity-stake strategy has moved fast. The Pentagon became MP Materials' largest shareholder in July 2025 with a $400 million preferred stock purchase and a price floor on neodymium-praseodymium oxide. It took stakes in Trilogy Metals, Lithium Americas, USA Rare Earth, and roughly two dozen other companies, mostly American, mostly through the Defense Production Act and the Office of Strategic Capital. The Commerce Department alone has been party to 24 of the 38 deals the Council on Foreign Relations has tracked, including a 10 percent stake in Intel.
Critics have not been quiet about the risks. The Cato Institute has warned the strategy is a fast track to cronyism, noting the Pentagon now holds positions in more than 20 companies with limited transparency into how those positions were priced or negotiated. Congressional testimony in March 2026 pressed Pentagon officials on exactly how equity stakes purchased with defense dollars would be monitored and eventually exited. None of that scrutiny has slowed the pace. What makes the Korea Zinc transaction different is not the dollar amount, which is modest next to the $27.7 billion aggregate, but the direction of the ask. Every other marquee deal in this portfolio involved an American company accepting government money to expand a mission it already had. Korea Zinc is a foreign, publicly traded giant that went looking for the Pentagon, built the offer, and needed a Seoul court to approve it over the objections of its own largest shareholders.
Construction on Crucible Zinc begins with site preparation this year, with phased commercial operations from 2029. If it hits that timeline, the United States will have rebuilt, in five years, a piece of industrial capacity it let vanish over five decades, financed in part by a company that sought out the Pentagon as a shareholder rather than the other way around, and owned in part by the agency that will one day depend on its output.