Actor Lee Jung-jae, the largest shareholder of software development company Artist United (WiderPlanet), is embroiled in a management dispute with Kim Dong-rae, the CEO of drama production company RaemongRaein, which was acquired by Artist United earlier this year. Kim expressed his frustration, stating, “I cannot allow myself to be a victim of forces attempting to usurp management rights.”
On Jun. 10, Kim released a statement regarding Artist United’s lawsuits against him for damages and for permission to convene an extraordinary shareholders’ meeting to secure management rights. He claimed, “Contrary to what was discussed before their investment, I heard that Artist United was planning to use RaemongRaein’s funds to acquire a listed entertainment company that is currently suspended from trading.”
Kim continued, “The current management team, including myself, conveyed to Artist United that we could not accept the acquisition of a listed company that deviates from our core business.” He explained, “In response, we received a unilateral notice to convene an extraordinary shareholders’ meeting to discuss the replacement of the CEO, a name change, the resignation and replacement of the entire board, and changes to the articles of incorporation.”
Kim added, “The actions of these investors, less than three months after becoming the largest shareholders, seem to be an attempt to use RaemongRaein’s cash assets as a vehicle for another company’s acquisition. It has become clear that their true investment purpose was not to produce diverse content or secure IP for RaemongRaein’s global expansion, as initially presented.”
He also stated, “I cannot allow RaemongRaein to become a victim of forces fraudulently attempting to seize management rights. As the CEO and Chairman of the Board, I must counteract management rights usurpation acts that go against shareholder interests through the board.”
Kim specifically noted, “I partnered with Artist United because I believed that RaemongRaein could aspire to global expansion with Lee Jung-jae’s network and financial power. However, Lee Jung-jae has never once visited the company nor presented any vision for management.”
He urged, “I call on Lee Jung-jae and the other investors to stop their unfair attempts and engage in sincere and rational discussions for RaemongRaein’s growth and development. I earnestly request support and encouragement so that the company can continue to produce high-quality content without being ruined.”
Artist United acquired RaemongRaein through a rights offering in March this year. As of the end of the first quarter of 2024, Artist United is the largest shareholder of RaemongRaein, holding 18.44%. Lee Jung-jae owns 5.12%, making their combined stake 23.56%. Kim holds 13.41%, and RaemongRaein director Yoon Hee-kyung holds 0.51%.
The content production company Wysiwyg Studios and its CEO Park In-kyu hold 10% and 5.12% of RaemongRaein’s shares, respectively, potentially playing a ‘casting vote’ role in the management dispute.
Meanwhile, Artist United, which is in conflict with RaemongRaein over management rights, applied to the court on Jun. 5 for permission to convene an extraordinary shareholders’ meeting and filed a damages lawsuit against Kim.
An official from Artist United explained, “We discussed ways for our directors, Lee Jung-jae and Jung Woo-sung, to participate in RaemongRaein’s management, but Kim did not respond to our requests and ignored the request to convene an extraordinary shareholders’ meeting, prompting us to file a lawsuit.”
