Asian Junkie Asian pop. Without discretion.
FNC Entertainment is under investigation by prosecutors for stock manipulation related to their signing of Yoo Jae Suk, according to a report by MBC News.
According to the exclusive report by MBC, this company saw a great deal of success with their idol groups, and went public on KOSDAQ in 2014. In July of last year a famous MC signed to the label, skyrocketing the share value of the company to 27,000 KRW (about $25 USD) per share. Around that time, a representative of the company (in the report labeled “Mr. A”) sold off 1.1 million shares in massive blocks to 10 institutional investors at a value of 235 billion KRW (about $204 million USD). According to the report, the block deal sale of shares was made by Mr. A just prior to the signing of the famous broadcast personality in July in order to reduce the market impact of the massive stock exchange, earning the investors who participated in the block deal over 10 billion KRW (about $8.7 million USD) in extra profit each. This sale of stock cut out other potential investors, and further undercut the stock price by about 400 KRW (about $0.40 USD) per share.
It generally seems to be described as “stock manipulation”, but unless I’m missing something, to simplify things just think of it as insider trading.
In other words, a handful of investors got tipped off that the company was going to sign a hugely famous celebrity and got a slightly cheaper share price in exchange for committing to a massive investment.
As you notice, the report itself doesn’t identify FNCE or Yoo Jae Suk, but it’s made painfully obviously through the broadcast that it’s them.
Though it has yet to be confirmed by the company itself, many suspect that the “major entertainment company” referred to in the report is FNC Entertainment due to the two major events listed in the report: 1) the company went public in 2014, and 2) FNC signed one of Korea’s most popular MCs, Yoo Jae Suk, in July of last year. There’s also the fact that the TV news report that broke this story, though blurring out the name of the company on the wall, quite obviously filmed their segment at FNC Entertainment.
Sooo … yup.
Mess.
Not looking forward to seeing what potential consequences could await the company’s artists if this investigation goes bad for FNCE.
https://twitter.com/asianjunkiecom/status/745620377963921412
This year, man.
