Bang Si Hyuk is facing an investigation for alleged misconduct, which claims that the HYBE founder had reportedly pocketed billions of won from the label's public offering in 2020 after striking deals with three major shareholders.
According to a report from The Korea Economic Daily, sources from the financial and investment banking industry confirmed that Bang Si Hyuk had obtained 400 billion won, which is equivalent to $287 million USD, from the HYBE's initial public offering through his private shareholders' signed agreement with local private equity fund companies.
According to the claims, the agreement shared that HYBE stakes acquired after the multi-label's investment in 2018 and 2019 are required to share 30 percent of profit to Bang Si Hyuk should HYBE go public.
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STIC Investments harbored a stake of 12.2 percent with HYBE, which was formerly known as Big Hit Entertainment at the time.
As for Estone and New Main Equity, the two firms had a joint stake of 11.4 percent. It was reportedly agreed that if HYBE failed to go public before the assigned time, the stakes and interest of the PEFs would have to be repurchased by Bang Si Hyuk.
Market analysts explained that it was "unusual" for a company's largest shareholder to earn profit from a stake by striking an agreement with shareholders before the company authorizes an IPO, suggesting misconduct and malpractice.
Officials from the Financial Supervisory Service also shared that no file containing the "Bang Si Hyuk-PEFs" shareholders agreement before HYBE's IPO can be recalled.
