[비즈한국] SLL JoongAng, the content production subsidiary of JoongAng Group, officially announced the establishment of a new music label, 'UNCORE,' in partnership with YG Plus in December 2024. At the time of its founding, Uncore garnered significant attention from the entertainment industry, with high expectations that combining JoongAng Group's media business with the capabilities of YG Entertainment could lead to successful results.
Internal expectations were also high. An official from SLL JoongAng stated at the time of Uncore's establishment, "The founding of Uncore will serve as a major stepping stone for SLL JoongAng to grow from a business structure centered on drama production and distribution into a global IP (intellectual property) powerhouse," adding, "We will internalize our music business capabilities and continuously secure artists through follow-up projects."
Although SLL JoongAng announced that it co-founded Uncore with YG Plus, no traces of YG are visible. SLL JoongAng holds all of Uncore’s shares, and its executives are all former JoongAng Group members. BizHankook attempted to reach out to Uncore to hear their position on the matter but was unable to make contact.
Uncore debuted the boy group 'CloseYourEyes' (CLUE) in April 2025. The members are alumni of the JTBC survival audition program 'Project 7.' CloseYourEyes has been on a smooth trajectory, winning the New Wave Artist award at the TikTok Awards, the IS Rookie award at the Korea Grand Music Awards, the K-Pop award at the Korea Culture & Entertainment Awards, and the Rookie of the Year award at the Seoul Music Awards.
However, concerns are rising that variables may arise due to the financial crisis at JoongAng Group. It is not yet easy for Uncore to survive on its own without financial support from the group. According to audit reports, Uncore's debt ratio reached 515.18% as of the end of last year. Profitability is also poor, with an operating loss of 7.6 billion won recorded last year. If JoongAng Group reduces its support or changes its business plans, it could have a negative impact on the activities of CloseYourEyes.
In June, JoongAng Group filed for corporate rehabilitation for affiliates including JoongAng Holdings, JTBC, Contentree JoongAng, Megabox JoongAng, and JoongAng P&I. SLL JoongAng, Uncore's parent company, is not included. SLL JoongAng is in a relatively better situation, with a debt ratio of 89.16% as of the end of last year and a record of continued profitable management.
Nevertheless, one cannot be optimistic about the future of SLL JoongAng in the current climate. In June of this year, Korea Ratings downgraded SLL JoongAng's unsecured bond credit rating from BB+ to B-, and its commercial paper and short-term bond ratings from B+ to C. Yang Hee-chul, a senior researcher at Korea Ratings, analyzed, "We cannot rule out the negative impact that the overall financial risks of the group, including JTBC and SLL JoongAng's parent company, Contentree JoongAng—which are closely linked in terms of business—will have on SLL JoongAng's business and financial aspects," adding, "The expansion of credit risk within JoongAng Group affiliates will likely constrain the company's financing conditions and lead to a transfer of liquidity burdens to the company."
Kwon Hyuk-min, a senior researcher at Korea Investors Service, also explained, "JoongAng Group has a very high level of financial interconnectedness through inter-company lending and credit offerings among major affiliates," adding, "Access to capital markets for the entire group has weakened due to a shortened debt maturity structure and an excessive debt burden relative to cash flow, and efforts to raise funds by utilizing assets are also being delayed."
At the time of Uncore's establishment, SLL JoongAng stated, "We plan to strengthen our competitiveness as a K-pop entertainment agency and solidify our position in the global market through broadcasting projects that follow 'Project 7' and in-house rookie development." 'Project 7' concluded in December 2024, but news regarding the 'broadcasting project to follow Project 7' mentioned by SLL JoongAng has yet to be heard. Without the emergence of follow-up artists, there are limits to Uncore's business expansion.
Another variable is the possibility of an SLL JoongAng sale. Contentree JoongAng, the largest shareholder of SLL JoongAng, has filed for corporate rehabilitation. As a result, rumors are consistently circulating that SLL JoongAng will be sold for survival. If there is a change in the management of SLL JoongAng, it will also affect the future management of Uncore. If the acquirer has no interest in the entertainment business, support for Uncore could be reduced.
CloseYourEyes continues its current pace. They are preparing a new album with a goal of releasing it at the end of September and are also conducting their concert tour, 'Beyond Your Eyes.' On August 23, they also participated in a ceremonial first pitch for professional baseball. There is a prevailing view that even if there are changes to the Uncore legal entity, there won't be major problems because CloseYourEyes has already reached a certain level of success. The reasoning is that in the worst-case scenario, even if JoongAng Group withdraws from the entertainment business, a group of the caliber of CloseYourEyes could transfer to another agency.
Ultimately, whether Uncore's business will continue despite the financial crisis seems to depend on the choices of JoongAng Group. A key factor in this decision will likely be the judgment on whether Uncore can become a cash cow for JoongAng Group in the long term.