Ador CEO's request for exclusive right to terminate NewJeans' contract with Hybe refused in February
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Ador CEO Min Hee-jin had asked for an exclusive right to terminate NewJeans’ contract with Hybe in February, but the request was turned down by the parent company, according to an industry source on Friday.
An exclusive contract with an artist can be seen as a key asset necessary for a company’s operation. Major entertainment companies, for this reason, require exclusive contracts to be approved by the board of directors.
Hybe, in turn, has a contract with Min which requires the Ador CEO to obtain consent from the company's directors when terminating NewJeans' management deal with Hybe.
Hybe rejected Min's request, seeing it as unreasonable, and did not comment further on the issue.
Currently, Ador has a board of three directors -- Min and her two close aides. She could easily get the two directors to approve the termination of NewJeans' contract with Hybe.
However, Hybe can prevent this from happening as it holds an 80 percent stake in Ador and can convene an extraordinary meeting of shareholders to change the directors.
Min wanted sole power to terminate the contracts so that Hybe would not have the power to keep NewJeans under its roof. NewJeans is the only group contracted to Ador, meaning its departure would leave Ador without any artists.
“It was a request to resolve unreasonable interference from outside during the early stage of NewJeans’ debut and also to allow operating Ador as an independent label,” Min said in a statement released yesterday.
Hybe believes this is in line with Min’s instant message with two board directors that read “making the company an empty shell.” Hybe said it discovered the message during its internal audit of Ador last month.
The parent company accused Min of attempting to poach the popular K-pop girl group and reported her to the police for an act of breach of trust.
Min denied the allegation, saying the instant message was nothing more than a small private talk with her aides and that she had no intention to execute such a plan.
Meanwhile, Hybe yesterday reported a sharp fall in revenue and operating profit in the first quarter of this year. Hybe’s sales declined by 12.1 percent on-year to 360.9 billion won, and its operating profit crashed 72.6 percent to 14.4 billion won.
By Kim Jae-heun(jaaykim@heraldcorp.com)
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