(Bloomberg) -- YG Entertainment Inc. said all four members of Blackpink renewed their contracts with the K-pop agency, dispelling concerns over the band’s continuation after their terms expired in August.
Shares in the Seoul-based artist promoter finished 26% higher on Wednesday, their biggest daily jump since a first-day pop when it went public in 2011. YG Plus, its content production affiliate, shot up 24%. Blackpink plans a new album and a world tour with YG, the agency said in a statement. Wednesday’s gain puts the agency — now the smallest among the four major Korean music labels — at $857 million in market value.
Other K-pop stocks also rose after the news. BTS label Hybe Co., the biggest K-pop stock with about $7.2 billion in market cap, rose 7.3% while smaller JYP Entertainment Corp. also advanced.
Blackpink, a four-member K-pop band that debuted in 2016, became the world’s most popular girl group with their songs setting records on the Billboard charts with hits like Shut Down and Pink Venom. The band became the first K-pop headliner at Coachella and their biggest global tour was sold out this year.
“We are more than thrilled to finally make an official statement that YG will continue the intimate relationship with Blackpink,” YG Entertainment founder Yang Hyun-Suk said in the statement. “As the group represents YG and K-pop itself, they will certainly endeavor to shine brilliantly in the global music market.”
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The news ends months of uncertainty around YG’s hold on some of its highest-earning artists. Before the announcement, YG’s shares plunged almost 50% from its May peak amid rumors that Blackpink member Lisa might leave the group. Top artists’ contracts are a source of price volatility for K-pop agencies, which rely heavily on a handful of key artists for revenue.
YG did not disclose the details of each member’s contract, including whether it will retain management of side gigs such as solo projects, luxury brand promotions or acting for Hollywood studios.
Still, Blackpink’s contract renewal resolves one of the main questions that’s weighed on K-pop stocks and sparked stock selloffs, according to Suh Bokyung, a senior analyst at Sanford C Bernstein. “This serves as a signal that investors can have an upbeat outlook on the K-pop industry in 2024.”
(Updates with the market value of the K-pop agencies, updates prices, adds a chart.)
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