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Why did HYBE initiate investigation of NewJeans’ agency ADOR and CEO Min Hee Jin? Brewing power battle explained
A new power struggle has ensued among the big names of the South Korean music industry: HYBE and ADOR. Know what is afoot and how it came to be here.
HYBE Corporation is a multinational company once established as BIG HIT Entertainment by Bang Si Hyuk. Being one of the leading companies in the entertainment business, HYBE at present owns shares in different labels like ADOR, BELIFT LAB, PLEDIS Entertainment, and more.
These labels are collectively known as HYBE Labels. In new developments, a fresh power battle has ensued between HYBE and its subsidiary ADOR.
HYBE invokes audit rights over ADOR, later reportedly asks CEO Min Hee Jin to step down
What caused HYBE to invoke its auditory rights?
HYBE Corporation at present has become a multinational company with stakes in other companies. HYBE has multiple subsidiaries which operate independently but receive creative support from HYBE. These subsidiaries come under HYBE labels.
One such label is ADOR, the popular girl group NewJeans label. ADOR’s CEO is Min Hee Jin who is also regarded as the brains behind NewJeans. She in the past worked at SM Entertainment.
In the most surprising events, HYBE invoked its auditory rights and issued an investigation of ADOR executives and CEO Min Hee Jin. HYBE admitted to Xports News that they had in fact invoked their right to auditing.
Apparently, HYBE had received a tip-off that ADOR’s CEO and VP were trying to plan a subsequent seizure of management rights. At present, HYBE owns 80% of ADOR’s shares and the remaining are held by ADOR’s executives including CEO Min Hee Jin.
It has been alleged that HYBE’s audit team found them leaking confidential information to attract investors to persuade HYBE to sell its shares in ADOR. Further, it is believed an unnamed executive from HYBE has been passing insider information to ADOR to help orchestrate the plan.
This person was part of the investor team in HYBE’s finance department before moving to ADOR this year. He is suspected of lending ADOR confidential documents, trade secrets, and other necessary information to separate it from HYBE.
According to Korean media outlets, HYBE began the audit of ADOR on April 22 KST. It was reported that HYBE’s audit team visited the ADOR office to retrieve computer assets and secure witness statements.
HYBE reportedly asks CEO Min Hee Jin to step down following audit
The battle has just ensued, and it seems it will go a long way. Following the reports of the audit of ADOR and its CEO and executives, it was reported that HYBE has asked CEO Min Hee Jin to step down from her position.
After finding evidence that CEO Min Hee Jin was attempting to take control of ADOR and work independently from HYBE, the latter demanded a shareholder meeting to discuss further steps.
HYBE allegedly called the meeting to ask CEO Min Hee Jin to step down and rebuke her and other executives in cahoots behind the takeover plan. This meeting is HYBE’s next move in their power battle against ADOR’s current board of directors. It is not confirmed whether the alleged demand from HYBE is obliged by ADOR’s board of directors.
HYBE plans to take legal action based on the information and evidence secured from the audit. According to law, HYBE can be granted power by the court for shareholder meetings and even elect its own director to ADOR’s board.
Following this whole conundrum, HYBE reportedly asked CEO Min Hee Jin to back down from her position as the CEO without legal persuasion. According to sources, it is expected Min Hee Jin will not accept it, and might go against HYBE.
HYBE has made no further comments on the issue. This brewing power battle between HYBE and ADOR comes as a surprise given that they together launched the surging powerhouse of a girl group, NewJeans.
Further, it is to be noted that CEO Min Hee Jin was the one under whose direction NewJeans was formed. She is recognized for her art direction as the visual director at her former company SM Entertainment.
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