An appeals court on Wednesday upheld a lower court's acquittal of a former energy firm head of causing losses to the state by making unsuccessful investment in mining projects.

Kim Shin-jong, former CEO of the state-run Korea Resources Corp., was indicted in September 2015 on charges of breach of trust. 

He was accused of incurring some 21.2 billion won ($18.6 million) in losses to the company by ordering the purchase of Korean builder Keangnam Enterprises Inc.'s stake in the nickel development business in Madagascar at an excessive value.

He was also suspected of causing about 1.2 billion won in losses from its investment in the redevelopment of a iron mine in Korea's eastern province of Gangwon.

He headed the resources firm from 2008-2012.

Confirming a lower court ruling made in February, the Seoul High Court said that he was not guilty as the investments were "managerial decisions," which are not something to be judged by the law."

The prosecution claimed that the stake purchase in Madagascar was made out of a request from the late former chief of the construction company, who was embroiled in a bribery scandal.

The court said there is not compelling evidence that substantiates that suspicion. (Yonhap)