[Reporter’s Notebook] From Discord to Owner Risks... HYBE Must Remember Its Responsibility as a Listed Company

HYBE has been one of the most attention-grabbing entertainment companies in recent years. Since BTS debuted in 2013, they have gained global popularity, taking the No. 1 spot on the U.S. Billboard Hot 100 with the song "Dynamite" in 2020. The company also drew attention for its aggressive mergers and acquisitions. In addition to acquiring domestic agencies such as Pledis Entertainment and Source Music in succession, HYBE also acquired the U.S.-based Ithaca Holdings, which manages pop stars like Justin Bieber and Ariana Grande. Having been recognized as not just a management agency but a global platform company, HYBE was listed on KOSPI in October 2020 and immediately reached a market capitalization of 8 trillion won.

However, less than six years after its listing, HYBE has become embroiled in owner-related risks. On April 21, the police requested an arrest warrant from the prosecution for HYBE Chairman Bang Si-hyuk on charges of fraudulent and unfair trading under the Capital Markets Act. Police believe that Chairman Bang deceived existing investors in 2019 by claiming there were no plans for a public listing, then secured approximately 190 billion won in personal gains from shares sold by those investors. It has been revealed that the investors transferred their shares to a special purpose company (SPC) established by a private equity fund related to Chairman Bang, raising suspicions that he planned unfair trading even before the listing. If the allegations are true, it means that the IPO market, where investors look to a company's future, was used as a vehicle for personal profit.

HYBE's management has shown signs of instability since it went public. A representative example is the conflict with former CEO of HYBE subsidiary ADOR, Min Hee-jin. In 2024, HYBE launched an internal audit, claiming that Min attempted to seize control of ADOR. Although there was debate over whether Min actually attempted to take over management rights, the underlying limitations of HYBE's management structure were also pointed out as a backdrop to the dispute. The multi-label system, which resulted from aggressive M&A, is said to have fueled conflicts between planners and artists within the group. This conflict is ongoing. On March 26, a damage compensation lawsuit worth 43 billion won was initiated between ADOR, Min, and NewJeans member Danielle. For investors, it is an unseemly dispute that shows no sign of ending anytime soon.

Amid a series of negative developments, investors' concerns continue to grow. Although many invested in HYBE with high expectations for a global platform company, the current stock price has halved from its peak of 421,500 won on November 17, 2021. This is all the more painful given that investors had anticipated improved performance with BTS's recent comeback. The stock price, which climbed as high as 405,500 won on February 13, this year, fell to 250,000 won at the close on April 22. Rather than external factors, it is HYBE's own owner risks and internal management conflicts that have brought the stock down.

It is true that HYBE still retains competitiveness as a global platform company. Partnering with global OTT platform Netflix, HYBE is a company that has artists capable of performing at Gwanghwamun Square in Seoul and also owns the "Weverse" platform, which seeks business opportunities based on intellectual property (IP). Maximizing these capabilities to benefit investors is both the role and responsibility of a listed company. A listed company is not a place where only one individual shines or benefits.

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