Actor Lee Jung-jae emerged victorious in the management rights dispute involving the production company Rae Mong R-a-i-n, widely known for the drama ‘The Youngest Son of a Conglomerate.’
On the morning of the 31st, Rae Mong R-a-i-n held an extraordinary shareholders’ meeting at its headquarters. During the meeting, proposals for amending the articles of incorporation, including changing the company’s name and adding business purposes, were approved. Additionally, the proposal to appoint Lee Jung-jae, Jung Woo-sung, and Lee Tae-sung, representatives of Artist United, as internal directors was also passed. The agenda proposed by former major shareholder Kim Dong-rae for appointing two internal directors was discarded due to the withdrawal of candidates.
In March, Rae Mong R-a-i-n conducted a paid-up capital increase of 29 billion KRW, resulting in Artist United becoming the largest shareholder. Artist United is a corporation where Lee Jung-jae holds the largest stake. Subsequently, disagreements over management rights between Kim Dong-rae and Lee Jung-jae led to legal battles.
At this shareholders’ meeting, Kim Dong-rae held 13.68% of the shares, while Lee Jung-jae’s side held 28.21%, nearly double that of Kim Dong-rae. This situation favored Lee Jung-jae, especially as the court approved an ‘injunction to prohibit and allow voting rights’ in favor of Lee Jung-jae just a day before the meeting. The court not only restricted Kim Dong-rae’s voting rights but also ruled that voting rights should support Lee Jung-jae’s agenda, with a penalty of 5 billion KRW for violations.
Even after excluding the shares of small shareholders, Lee Jung-jae’s side exercised over 40% of the voting rights. They reportedly secured over 60% of the voting rights compared to the total shares at this meeting. The agenda for amending the articles of incorporation, a matter requiring a special resolution, passed smoothly. Rae Mong R-a-i-n decided to change its name to ‘Artist Studio’ as a result.
Lee Jung-jae’s side newly appointed 3 internal directors and 1 external director, gaining a majority on the board of directors. The existing board of Rae Mong R-a-i-n consisted of 7 members, including 2 internal directors, 2 external directors, and 3 non-executive directors. Among them, the 3 non-executive directors are affiliated with Lee Jung-jae’s side.
With Lee Tae-sung from Artist United now appointed as an internal director, the board composition is expected to be 6 from Lee Jung-jae’s side and 4 from Kim Dong-rae’s side. Among the current board members, Kim Dong-rae’s term is the closest to expiring, ending in March next year.
However, ongoing lawsuits between the two parties remain a variable. Previously, Kim Dong-rae sued Lee Jung-jae’s side for fraud, to which Lee Jung-jae responded with a countersuit for false accusation.
A representative from Artist United stated, “With the director appointments successfully completed, we will focus on pursuing new business ventures and improving management using the capital from the paid-up capital increase.”
Meanwhile, Lee Jung-jae and Jung Woo-sung did not attend the extraordinary shareholders’ meeting.