1

HYBE has issued a statement addressing allegations surrounding its initial public offering and stock transactions, which have led to an official investigation involving chairman Bang Si-hyuk.

“We apologize for the concerns caused by recent reports regarding our IPO,” the company said on July 9. “We are actively cooperating with financial authorities and the police by submitting all necessary documents to clarify the facts.”

HYBE added, “Though the process may take time, we will faithfully explain that all procedures were conducted in accordance with the law and regulatory standards.”

The case entered formal proceedings after the Capital Market Investigation Deliberation Committee, under the Financial Services Commission, decided to recommend Bang for prosecution over alleged violations of capital market laws. The Securities and Futures Commission is set to review the matter at its regular meeting on July 17.

Regulators believe Bang misled the public by stating there were no IPO plans, while secretly setting up a private equity fund with key insiders to transfer shares and later push for listing. Authorities suspect that the fund was used to bypass mandatory lock-up rules and that the transaction netted several hundred billion won in profit.

The controversy has grown after it was revealed that the contract in question was omitted from documents submitted during Korea Exchange’s IPO review and in HYBE’s public securities filing with the Financial Supervisory Service. This raised concerns that early general investors, who had limited access to information, may have suffered losses.

HYBE stated it will respond in accordance with the investigation and legal procedures moving forward.