YG Entertainment stock price continues to take a hit after its founder Yang Hyuk Suk alleged Prostitution Mediation.
The issue was brought up by MBC show “Straight” which claims that they found evidence and secured witnesses that Yang Hyuk Suk mediated prostitution for foreign investors in 2014.
As soon as May 27 trading began, the stock price immediately fell, and by the end of the day, it fell 12.5% (lost approx. $3.46) and concluded the day at 28,700 won (approx. $24.24).
In comparison to the stock peak price in January 2019 (approx. 42$), the stock fell by 50% .
That’s not the only issue YG is facing, the agency marketing capitalization dropped a staggering $253.3 million. During its peak earlier this year it was valued at $704.6 million and on May 27, its valued at $440.9 million.
Despite BLACKPINK interest gain overseas, the agency was heavily and negatively impacted by Seungri’s controversy who is suspected of many charges not to mention “Burning Sun” club controversy as well.
YG also took a hit when it was revealed that the owner of a club called “Love Signal” was Yang Hyun Suk and not Seungri. The club was accused of evading taxes by registering as a regular restaurant instead of an adult entertainment establishment.
YG Entertainment stock price took another hit when it was revealed that YG is being investigated by the National Tax Service who launched a special investigation. Now with the prostitution mediation allegations, YG stock is suffering even more. Shareholders are concerned after the stock price continues to fall.
On May 27, MBC “Straight” aired its episode dedicated to Yang Hyun Suk and reported that h had allegedly solicited prostitution for two wealthy south Asian investors.
The report states that 25 women accompanied the eight men at a meeting where Yang Hyuk Suk was waiting for them with another YG singer. The sexual services allegedly took place at the club reportedly owned by Yang Hyuk Suk himself.
The program interviewed sources who talked about the meeting in details.
YG Entertainment had previously issued a statement denying the report stating that Yang Hyuk Suk was present because he was invited but there was no solicitation of prostitution.
Netizens are heavily criticizing Yang Hyuk Suk and some promise to boycott the agency with its artists.
What do you think of this?
My Personal Thoughts
WOW! This is some heavy news!
I just personally feel sorry for the people who work under YG and for the artists who are under them who will take a hit after this report.
I can’t say I believe the report and we honestly don’t know yet, it’s too early to speculate. We’ll see as time goes by. But I want to point out something that I have noticed, YG is not threatening legal action.
Back when Seungri controversy started (at the very beginning), they clearly stated (at the beginning) they will take STRICT LEGAL ACTION against those who spread false rumors (pointing at MBC) and they received so much criticism for that. They later apologized for saying that.
This is worse than the Seungri case to YG Ent. because it’s about their founder. This is VERY BIG. Why aren’t they saying they’ll sue? If he has not done anything wrong, why aren’t they threatening legal action?
I mean, if I were innocent, I would be furious and immediately sue those who tried to stir controversy and implicate me.
Only time will tell how far this goes and if Yang Hyuk Suk is guilty or not. But regardless of that, the public has already made up their minds. I thought that YG could recover with Lee Hi and then iKON comeback later.
But with this report, we don’t know what will happen and if they’ll be able to help the agency recover.
We also have the ‘special’ tax investigation that’s going on right now with the agency, and if the special task force came back with something incriminating the agency (it hasn’t yet but I am speculating as the investigation is still ongoing) I honestly don’t know if they’ll ever be able to recover their image.
There is one thing I know for sure, it’ll take a while before YG repair its image with the public. Netizens opinions matter in South Korea, that’s a double-edged sword because it can drive positive change or negatively and unjustly impact an innocent person life.
2019 is hella wild; I never thought there would be a day where such things happen. I am shocked!