South Korean girl group aespa at the 2022 KBS Song Festival at Jamsil Arena on December 16, 2022, in Seoul, South Korea.
The Chosunilbo Jns | Imagins | Getty Images
The K-pop agency behind BTS will become the largest shareholder of SM Entertainment – the legacy company known for starting a wave of popularity in Korean pop culture.
Hybe Co. agreed to acquire a 14.8% stake held by SM Entertainment founder Lee Soo-man in March, according to a preliminary filing on Monday morning ahead of the Seoul market’s opening – and pledged in a separate announcement to buy another 25% stake.
That would make Hybe the top shareholder in SM Entertainment. Lee is currently the top investor in SM Entertainment with an 18.45% stake, according to Refinitiv data, followed by South Korea’s National Pension Service, KB Asset Management and Norway’s Norges Bank Investment Management, according to the latest filing.
The deal is targeted to “increase competitiveness in the K-pop industry and generate synergy effects,” Hybe said in the filing.
Shares of SM Entertainment surged on Friday, rising more than 16% at the open in Seoul. Hybe rose 6% and JYP Entertainment rose 2.5%, while YG Entertainment gained 3.8%.
Girl group NewJeans attended the 2022 The Fact Music Awards on October 8 in Seoul, South Korea.
Chung Sung-jun | Getty Images Entertainment | Getty Images
The agency is also known for its rising girl group NewJeans — which debuted on Billboard’s Hot 100 with the hit “Ditto” last month in its six-month debut.
SM Entertainment is also the agency behind top bands Super Junior, Girls’ Generation and Red Velvet, the group that performed in front of North Korean leader Kim Jong Un in 2018 in the latest inter-Korean diplomacy, along with president Moon Jae. -at.
Hybe bought 3.5 million shares of SM Entertainment at 422.8 billion won ($334.2 million) – or 120,000 won per share, with a premium of more than 20% compared to SM Entertainment’s closing price of 98,500 won in the market on Friday .
This comes after South Korean internet company Kakao announced plans to acquire a 9% stake in SM Entertainment in a deal worth 217 billion won. Cocoa shares rose shortly after the announcement on Tuesday earlier this week and ended trading more than 4% lower on Friday.