YG Entertainment has announced plans to sell 60% of its shares in the drama production company Studioplex by the end of the year. This decision will reduce YG Entertainment's ownership in Studioplex from 99.9% to 39.9%, with the transfer of management rights also taking place.

In response to inquiries, YG Entertainment revealed on May 7 KST, stating, "We are in the process of selling a portion of Studioplex shares to a production company with the aim of establishing a robust and competitive business structure aligned with our core operations." The company emphasized its commitment to enhancing the financial stability of Studioplex, stating, "We are dedicated to strengthening the production environment to ensure fiscal soundness." 

Established in 2017, Studioplex was founded by YG Entertainment amidst the growing presence of competitors such as SM Entertainment and JYP Entertainment. The move aimed to leverage synergies between drama production and talent management as part of a strategy for diversifying revenue streams.

However, the production company faced challenges with certain works receiving negative attention. Notably, the SBS drama 'Joseon Exorcist', produced by Studioplex in March 2021, gained infamy for its historical inaccuracies, leading to its cancellation after just two episodes.

Similarly, the tvN drama 'Mr Queen', also produced by Studioplex and the same writer, faced criticism for its portrayal of historical events.

As a result, Studioplex experienced a decline in performance and increased debt, with losses from 'Joseon Exorcist' being particularly significant. The production was terminated prematurely, resulting in the write-off of all production costs as losses.

SEE ALSO: Renowned dog trainer Kang Hyung Wook engulfed in gaslighting controversy amid severe employee criticism