Hive's Bold Move to Dominate SM... Legal Experts Take Center Stage

[Asia Economy Reporter Kim Hyung-min] "I want to contribute to the birth of Korean companies that succeed on the global stage."

Jung Jin-soo, Chief Legal Officer (CLO, Judicial Research and Training Institute Class 23) of HYBE, said this in an interview with the Seoul Bar Association Newsletter on the 9th. He first learned to work as a lawyer at Kim & Chang Law Office in 1997. At that time, the most common cases he encountered were bankruptcies. It was the so-called IMF era when the Korean economy was struggling and received support from the International Monetary Fund (IMF). He personally experienced the scenes where companies were fighting for survival. Afterwards, he worked for 15 years handling intellectual property rights and mergers and acquisitions (M&A) related tasks. His goal seems to stem from these experiences. His decision to join NCSOFT (2011?2022) and HYBE (2022?) also originated from the thought, "How about I jump in myself and contribute to building a good company?" During his tenure at NCSOFT, Jung CLO was highly regarded as CEO Kim Taek-jin’s "right-hand man." He was credited with strengthening the company’s legal functions, establishing new legal procedures, and leading related tasks. After moving to HYBE in 2022, he continued to play a pivotal role in legal affairs.

Jinsoo Jeong, Chief Legal Officer (CLO) of HYBE [Photo by Asia Economy DB]

His enthusiasm and experience are the reasons HYBE put forward Jung CLO as a new director candidate for SM Entertainment. On the 15th, HYBE sent a shareholder proposal email to SM, drawing attention from the related industry and legal circles by prominently featuring multiple legal professionals. Among the seven director candidates (three inside directors, three outside directors, and one other non-executive director), three, including Jung CLO, are legal professionals. Jung CLO was nominated as an inside director candidate. Kang Nam-gyu, representative lawyer of Gaon Law Firm (Class 31), was recommended as an outside director, and Park Byung-moo, representative partner of VIG Partners (Class 15), was recommended as the other non-executive director.

The nominated board members are evaluated as "practical." Even though prominent figures initially mentioned in the industry, such as Bang Si-hyuk, HYBE chairman, and Min Hee-jin, Adore CEO, were excluded, the lineup is considered weighty. The inclusion of legal professionals seems to have played a part.

After HYBE recently announced a public tender offer to buy SM shares at 120,000 KRW per share and SM’s stock price rose, putting HYBE in a tight spot, the full deployment of legal professionals is also interpreted as HYBE’s determination to directly confront the upcoming shareholders’ meeting next month.

Hive Photo by Yonhap News

There is also an analysis that HYBE followed the recent trend in the business world of actively involving legal professionals as board members. According to the legal community, since President Yoon Suk-yeol, a former Prosecutor General, took office, companies have shown a marked preference since last year for appointing legal professionals as inside or outside directors. This is to gain positive effects when there is a legal expert among directors with voting rights on major issues critical to the company’s fate, who can quickly assess legalities and potential disputes. It can also serve as a channel to increase interaction with the government.

The backgrounds of the legal professionals recommended by HYBE are impressive. They are especially recognized for their expertise in corporate finance and accounting. Lawyer Kang Nam-gyu has over 17 years of experience in tax disputes. In the legal community, his record of winning all five cases in 2019, including corporate tax and local tax lawsuits involving E-Land World, achieving a 100% success rate, is well known. He is also knowledgeable about international tax issues and, unusually for a lawyer, holds the Chartered Financial Analyst (CFA) qualification. Representative Park Byung-moo worked at Kim & Chang’s corporate finance M&A team from 1989 to 2000. Despite the social atmosphere being unfavorable toward M&A at the time, he gained attention by resolving important M&A cases. Since the 2000s, he has served as an outside director at several companies including NCSOFT. From 1994 to 1996, he studied corporate finance and Third World financial system improvement measures at Harvard Law School in the U.S. He also holds a New York State Bar license. In addition, Choi Kyu-dam, a certified public accountant and former head of financial strategy at NCSOFT, nominated as a non-executive auditor candidate, worked as an accounting expert at Kim & Chang for 16 years starting in 1998.

This content was produced with the assistance of AI translation services.