Fantagio Faces Management Dispute Between Major Shareholder and Executives... Decision Expected at July Extraordinary General Meeting
[Asia Economy Reporter Park Hyungsoo] Fantagio is showing signs of a dispute over management rights between its executives and major shareholders.
On the 25th, the Korea Exchange KOSDAQ Market Headquarters announced that it may designate Fantagio as a non-compliant disclosure corporation due to delayed disclosure of a provisional injunction banning new share issuance.
Fantagio, a KOSDAQ-listed company, is an entertainment agency. Gold Finance Korea, which became the major shareholder by acquiring Fantagio shares in 2016, recently sold its holdings. L&A Holdings Co., Ltd. and five others signed a share transfer agreement with Gold Finance Korea in April. Gold Finance Korea sold all 22,775,800 shares it held at 660 KRW per share. The transfer amount is approximately 15 billion KRW.
Although Gold Finance Korea has withdrawn from Fantagio's management, L&A Holdings has not yet been able to exercise management rights. To secure management rights, L&A Holdings requested the existing Fantagio management to convene an extraordinary general meeting and to allow inspection of accounting books. This is a standard procedure taken by a new largest shareholder who acquires shares through a share transfer agreement and declares management participation.
It appears that CEO Park Haeseon is not cooperating well with the new largest shareholder. L&A Holdings filed lawsuits for permission to convene a shareholders' meeting and a provisional injunction banning new share issuance. The existing management delayed disclosure of news related to the lawsuits, and the Korea Exchange announced its intention to designate the company as a non-compliant disclosure corporation.
The Fantagio management postponed the extraordinary general meeting, originally scheduled for the 17th, to July 24. The outcome of the vote at the extraordinary general meeting will determine the direction of Fantagio's management rights.
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The largest shareholder side expressed concerns that there might be disruptions in the management of affiliated entertainers during the process of securing Fantagio's management rights.
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