SEOUL - Singer-songwriter Park Jin-young allegedly pushed for the sale of JYP Entertainment in a reported bid to avert an investigation into the allegation that his company was illicitly funded by the Salvation Sect.
Entertainment industry sources said Tuesday that Park had suggested YG Entertainment take over JYP Entertainment. YG's CEO Yang Hyun-suk, however, was found to have reportedly turned down his proposal.
Sources noted that Park's suggestion was delivered to Yang before the Sewol disaster occurred on April 16. The 42-year-old CEO married in October 2013 the second daughter of Yoo Byung-ho, who is the younger brother of the ferry owner Yoo Byung-eun.
Park and Yang have had a close relationship, and Park reportedly expressed the intention of pursuing only his individual music activities after scrapping the entertainment business.
Sources, however, speculated that Park had attempted the sale as he had been afraid of low-key probes from law enforcement agencies and financial regulators into allegedly shady deals between JYP and the Salvation Sect, which is led by Yoo Byung-eun.
"Yang's rejection also appears to be due to his concern over the possibly negative effect of revelations involving JYP," said a source.
While Park has dismissed the allegation that JYP was given some billion won in funds raised by the sect, his father-in-law Byung-ho was taken into custody for charges of pocketing company funds and other irregularities in late June.
As Park's 62-year-old father-in-law is a key leader of the sect, the prosecution is set to widen the scope of its probe into JYP Entertainment as part of its effort to verify a variety of charges against the 73-year-old Yoo Byung-eun.
While investigators are looking into JYP's bank accounts in coordination with the Financial Supervisory Service, some market insiders raised the possibility that the prosecution will soon summon Park.
Park has recently argued that he and his parents are not devotees of the Salvation Sect and he was paid nothing from the religious group.
Later in the day, JYP Entertainment denied the speculated stake-disposal attempt in a statement. The agency also claimed that it has made no business partnership or cross-funding transactions with sister firms of Chonghaejin Marine Co., the operator of the ill-fated Sewol.
Meanwhile, foreign investors and corporate investors have continued to dump their stake in JYP Ent. on the secondary KOSDAQ over the past few weeks.
While its closing price was 6,080 won (S$7.50) per share on April 15, a day before the ferry tragedy, it has ranged between 4,200 won and 5,500 won won since. Foreigners' shareholding ratio in the company has dropped to 0.42 per cent, from 1.0 per cent in early May.