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YG CEO faces no-confidence vote amid Seungri scandal

By Lee Ji-yoon

  • Published : Mar 20, 2019 - 16:26
  • Updated : Mar 20, 2019 - 16:26

YG Entertainment shareholders will vote on whether to replace CEO Yang Min-suk, the younger brother of the agency’s founder and chief producer Yang Hyun-suk, Friday amid the snowballing sex bribery and corruption scandal surrounding former Big Bang member Seungri.

Since the agency’s listing on the local bourse in 2011, the younger Yang has led its sprawling business while his older brother and largest shareholder stepped away from day-to-day operations to focus on his producer role.

Founder Yang and the CEO own 16.12 percent and 3.31 percent stake in the company, respectively.

YG Entertainment founder and chief producer Yang Hyun-suk

The shareholders meeting comes as the company’s share price has tumbled almost 30 percent since police investigations started last month over allegations that Seungri had offered prostitution to potential business partners from two years ago.

The singer has denied all allegations, but announced his retirement from entertainment. YG also terminated its contract with him, issuing a public apology over its lax management of the artist.

Having already witnessed a series of shady scandals involving several YG performers, however, fans and the public are calling for leadership changes.

Adding to the pressure is fresh allegations of tax evasion against the Yang brothers. They were recently revealed to be the real owners of a Seoul club called Love Signal, which was thought to be owned by Seungri.

Ahead of the gathering of shareholders this week, keen attention is now being paid to key institutional investors whose votes will decide the fate of one of the nation’s largest entertainment agencies.

Investors who are obliged to disclose their stake ownership of more than 5 percent include LVMH-backed Global World Music Investment at 9.53 percent, Naver at 8.5 percent, Shanghai Fengying Business Consultant Partnership at 7.54 percent and the state-run pension fund National Pension Service with 6.06 percent.

By Lee Ji-yoon (jylee@heraldcorp.com)

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