Lee Jung-jae's Company Faces Compensation Lawsuit
"Attempting to Acquire Company Using RaemongRaein Funds"
Actor Lee Jung-jae's company, Artist United, which is the largest shareholder, has filed a damages lawsuit against the drama production company RaemongRaein's CEO, while RaemongRaein expressed grievances, claiming that they are trying to usurp management rights.
Kim Dong-rae, CEO of RaemongRaein, released a statement on the 10th, asserting, "Contrary to what was discussed before Artist United's investment, I heard that they were working to acquire a listed entertainment company under trading suspension using RaemongRaein's funds."
He continued, "The current management, including myself, conveyed to Artist United that we could not accept the acquisition of a listed company that deviates from the company's core business," adding, "The response we received was a unilateral notice to hold an extraordinary general meeting of shareholders to change the CEO and company name, have all board members resign and be replaced, and amend the articles of incorporation."
Earlier, on March 14, Artist United, along with co-investors, signed an investment contract to acquire RaemongRaein. The investment payment was made six days later, on March 20, and subsequently, Artist United became the largest shareholder of RaemongRaein.
Afterwards, Artist United reportedly discussed film and drama productions related to in-house actors Lee Jung-jae and Jung Woo-sung with RaemongRaein. However, the company later filed a damages lawsuit, claiming that CEO Kim did not comply with investors' demands and ignored requests to hold an extraordinary general meeting of shareholders.
In response, CEO Kim pointed out, "This movement by investors, less than three months after becoming the largest shareholder, appears to be nothing more than using RaemongRaein's cash assets as a shell for acquiring other companies."
He added, "I cannot allow RaemongRaein to become a victim of forces that deceitfully usurp management rights. As CEO and chairman of the board, I cannot condone management rights usurpation acts that go against shareholder interests, so I have no choice but to check them through the board of directors and others."
He also expressed disappointment regarding Lee Jung-jae. CEO Kim said, "I believed that with actor Lee Jung-jae's network and financial power, RaemongRaein could dream of global expansion, which is why we partnered with Artist United," adding, "This actor has never once visited the company nor presented any vision regarding management."
RaemongRaein, established in 2007, is a drama production company that participated in producing famous dramas such as Sungkyunkwan Scandal and The Youngest Son of a Chaebol Family. It was listed on the KOSDAQ market in 2021.
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