HYBE Corporation now owns 14.8% of K-Pop competitor SM Entertainment’s assets
The K-Pop company behind the global phenomenon BTS, Hybe Corporation, has acquired a 14.8% stake in competitor SM Entertainment’s assets from its founder Lee Soo-man for ₩422.8 billion Korean won, approximately P18 billion.
Confirmed by an official statement from Hybe via Korean media outlet Sports Chosun on Friday, February 10, it read, “[Hybe founder] Bang Si-hyuk and former SM Chief Producer [Lee Soo-man] mutually agreed on the shared vision for the future of K-pop industry, followed by signing of the stock purchase agreement.”
For this reason, it makes Hybe the largest shareholder of SM Entertainment. The former bought a 14.8% share from an 18.4% stake previously held by the latter’s previous largest shareholder and founder Lee Soo-man.
Soo-man controls 18.4% of the company and has been in dispute with its current management in recent years. This boils down to issues involving the company’s business dealings with his private company.
On the other hand, the Korean media conglomerate Kakao Corporation is the second-largest shareholder of SM Entertainment. This becomes possible after acquiring a 9.05% stake from the music label.
SM Entertainment, founded by Lee Soo-man in 1989, is known as one of the leading music labels in South Korea. It became home to K-pop acts TVXQ!, Super Junior, Girls’ Generation, SHINee, EXO, Red Velvet, NCT, and, currently, one of the best-known 4th generation groups, aespa, as well as soloists Boa and former H.O.T. member Kangta, and more.
Hybe, on the other hand, owns multiple subsidiaries such as Big Hit Music, Source Music, Pledis Entertainment, Belift Lab, KOZ Entertainment, and ADOR. These companies are collectively known as Hybe Labels. The label is home to Korean music acts BTS, Seventeen, Tomorrow X Together (TXT), Enhypen, Le Sserafim, NewJeans, fromis_9, and Zico, among many others.
According to a report from Reuters, Soo-man has been in dispute with SM Entertainment’s current management in recent years. This is due to the label’s business dealings with his private company.
Prior to the acquisition, SM’s current CEO Lee Sung-soo, who is known as Soo-man’s nephew, and COO Tak Young-jun reportedly unveiled plans for a restructured “SM 3.0″. It included terminating its contract with Soo-man in October 2022, per the British publication NME.
