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HYBE to seek probe over alleged insider trading by ADOR executive

Published: 14 May. 2024, 18:12 Updated: 14 May. 2024, 18:23

SHIN HA-NEE
[email protected]

HYBE's headquarters in Yongsan District, central Seoul [NEWS1]

HYBE will request that the financial regulator investigate its subsidiary ADOR’s management, including CEO Min Hee-jin, over allegations of illegal insider trading, the K-pop agency said Tuesday.

ADOR, which manages the girl group NewJeans, has denied the accusation.

In its filing for an investigation by the Financial Supervisory Service, HYBE is alleging that an unnamed executive at the subsidiary label sold 950 shares of HYBE on April 15, before the high-profile conflict between the two companies became fully public.

ADOR sent an email accusing its parent company of unfair treatment toward NewJeans the following day. HYBE conducted an internal probe into group's label on April 22, a week after the sale, which sent the company’s stock price nose-diving in the market.

HYBE's share price plunged by 7.81 percent on April 22 from the previous day, and has since declined 16 percent to close at 193,500 won ($141.24) on Tuesday.

The stock sale was worth about 200 million won, with each share priced at 214,605 won on average.

HYBE has accused the executive of using undisclosed internal information for unfair personal gain, and reportedly submitted evidence of an online conversation in which the executive and CEO Min explicitly admitted “if the conflict becomes public, the share price will plunge” in March.

ADOR refuted the claim, saying that the probe by the parent label was unexpected and thus the sale could not be planned before the conflict became public.

"The capital gains from the stock transaction amounted to only 19 million won," said ADOR in a statement, saying that the sale was for a lump-sum jeonse deposit housing contract.

BY SHIN HA-NEE [[email protected]]