Thursday, November 14, 2024
Hybe to sell SM stake after losing to Kakao.

Hybe to sell SM stake after losing to Kakao.

Hybe to Sell Stake in Rival SM Entertainment to Kakao Corp

After a failed attempted takeover bid, Hybe Corp., the company behind K-pop group BTS, has announced that it will sell its 15.8% stake in agency rival SM Entertainment to tech giant Kakao Corp for around $437 million. Hybe initially purchased the 14.8% stake in SM in February from K-pop pioneer Lee Soo-man, with the expectation of buying the remaining 3% tranche. However, opposition from SM’s management, coupled with Kakao’s richer offer to purchase up to 35% of SM’s existing equity, prompted Hybe to admit defeat and withdraw its tender.

The Takeover Battle Between Hybe and Kakao

SM Entertainment, the South Korean entertainment company behind some of the biggest K-pop stars, including EXO and Red Velvet, has been the target of a dramatic takeover battle between rivals Hybe Corp and Kakao Corp. Hybe’s initial purchase of the 14.8% stake in SM from company founder Lee Soo-man caused concern among SM’s management, who launched a range of measures including a content distribution deal and the sale of newly issued shares and bonds to Kakao entities. While a court initially ruled against SM creating new shares for the purpose of defeating a takeover bid, Kakao’s significantly richer offer to all shareholders for up to 35% of SM’s existing equity made Hybe’s bid untenable, leading to Hybe’s withdrawal of its tender in March.

Kakao’s Growing Presence in K-pop and the Music Industry

Kakao Corp’s successful offer to purchase the stake in SM Entertainment solidifies its growing presence in the K-pop and music industries. Last week, Kakao subsidiary Kakao Entertainment America announced a deal with Columbia Records to manage K-pop girl group IVE, adding to its ownership of Melon, Korea’s leading music streamer. This move marks a significant step forward in Kakao’s ambition to become a major player in the global music market.

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About Maya Patel

Maya Patel is a talented blogger with a focus on the exciting world of entertainment. She blogs about celebrities and gossip, humor, movies, TV shows, music and concerts. With a keen eye for detail and a love for all things pop culture, Maya provides insightful reviews, news, and commentary that keep her readers informed and entertained. Follow her and stay up-to-date with the latest trends and happenings in the world of entertainment!

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