For the first time since the founding of THE BLACK LABEL, representatives of YG ENTERTAINMENT have disappeared from its board of directors.
According to analyses, the label has begun a reorganization of its governance structure in view of an initial public offering (IPO), by breaking free from the influence of its former parent company to embark on a completely independent path. According to the industrial sector on April 24, YANG MINSUK, CEO of YG ENTERTAINMENT, resigned from his position as non-executive director of THE BLACK LABEL on December 20 of last year and withdrew from the board of directors. A representative of THE BLACK LABEL stated:
“Director YANG MINSUK was removed from the board following the expiration of his term”.
CEO YANG had joined the board of directors of THE BLACK LABEL for the first time in 2021 as an executive director. From 2022, upon his return as co-CEO of YG ENTERTAINMENT, he had left his position as executive director at THE BLACK LABEL to be re-elected as a non-executive director, a non-permanent position, in order to participate in major decisions.
Before CEO YANG, HWANG BOKYUNG, the former CEO of YG ENTERTAINMENT, sat on the board of directors of THE BLACK LABEL. She had been one of the pillars of the board of directors at the beginning of the founding, serving there as executive director from 2016 to 2021.
With this resignation of CEO YANG, personalities linked to YG ENTERTAINMENT are for the first time totally absent from the board of directors of THE BLACK LABEL. It is estimated that after being launched in 2016 as a label under the umbrella of YG ENTERTAINMENT, it has put in place an independent governance 10 years later.
THE BLACK LABEL initiated its independent management as early as 2020. Beyond the simple production of songs for YG ENTERTAINMENT artists, the label actively recruited artists and concentrated its efforts on the release of albums and management.
The influence of YG ENTERTAINMENT on the governance structure was also gradually reduced. Until 2019, YG ENTERTAINMENT held 45% + 1 share of THE BLACK LABEL, considering it a subsidiary, but it was reclassified as an associate company in 2020.
From 2021, YG ENTERTAINMENT‘s share in THE BLACK LABEL began to drop seriously due to the attraction of outside investments. It fell to 27.6% at the end of 2023 and reached 14.55% at the end of last year.
Currently, management is led by experts from PEARL ABYSS. CEO JUNG KYUNG IN, who joined the company at the end of 2022, and Chief Financial Officer (CFO) CHO SUK WOO, recruited last year, are its pillars. These two personalities are the key figures having together led the listing of PEARL ABYSS on the KOSDAQ in the past, which suggests that their recruitment aimed for a future IPO.
With this reorganization of the board of directors now composed of independent members, it is considered that the label has equipped itself with the physical and human foundations necessary for autonomous management. Recently, the company has also put emphasis on fundraising by soliciting investments of several tens of billions of won from KRAFTON, TENCENT, etc.
A sector official predicted:
“The resignation of CEO YANG MINSUK from the board of directors is a strong signal indicating that THE BLACK LABEL is no longer under the management system of YG ENTERTAINMENT. Aggressive investments will follow to maximize the IPO valuation on the basis of independent decisions of the board of directors”.
Journalist: Shawn
Translator: Shawn
Source: Website The Black Label
