Kakao officially SM Entertainment’s largest shareholder with 39.9% stake, as HYBE holds onto 8.8%
Kakao Corp has officially become SM Entertainment’s largest shareholder, culminating in a months-long corporate battle with SM rival HYBE for control of the K-Pop company.
Kakao and its unit, Kakao Entertainment, increased their stake in SM to 39.9% from 4.9% previously after completing a share offer in the company behind the stars K-Pop like NCT, EXO and Aespa, according to a report. securities filing on Tuesday (March 28).
The owner of mobile messaging app KakaoTalk purchased an additional 1.66 million shares of SM from takeover rival HYBE for about 248.76 billion Korean won (approximately $191 million), or 150,000 won each share. private profile same day.
BTS’s management company HYBE planned to divest all of its 15.78% stake in SM, but Kakao’s Tenderer was registered in excess of twice the targeted shares, forcing the company to downsize the allocation.
HYBE will remain a shareholder of SM with 8.81% stake. Based on SM’s closing price on Wednesday, HYBE’s stock is valued at 204.42 billion won ($157 million) versus 343.18 billion won ($264 million) previously.
The company said plug out about the race for control of SM earlier this month “after seeing signs of overheating in the market due to competition from both Kakao and Kakao Entertainment.”
HYBE has also taken into account the “potential negative impact on HYBE’s shareholder value,” it said.
Hyundai Motor Securities analyst Kim Hyun-yong said that retaining SM shares could help HYBE ‘constrain’ Kakao in the long run. Reuters report.
“Remaining as a major shareholder with more than 5% of the shares would be a good move in deterring (rivals) although it is unlikely to have a major influence on decision making,” Kim said. quoted news agency.
Meanwhile, Kakao CEO Hong Eun-taek acknowledged the deal during the company’s shareholder meeting on Tuesday, saying Kakao’s next step is to realize the business cooperation between Kakao, Kakao Entertainment and SM Entertainment, according to local media. Ajunews.
Hong also highlighted Kakao’s intense focus on artificial intelligence (AI) and healthcare.
“We are focusing on AI and healthcare to find new opportunities for sustainable growth in the medium and long term,” said Hong.
recent kakao show a new virtual K-Pop group called MAVE adopts Entertainment Metaverse joint venture with Korean mobile game developer Netmarble.
The move reaffirms Kakao’s strategy to become the dominant player in the Korean entertainment industry and the move to further integrate the metaverse concept into its other business units.
Kakao launched a metaverse service called Kakao Universe in June to connect global users with similar interests.
Most recently, the company said it is planning to extend in the US and globally. It recently collaborated with Music Sony‘S Columbia Profile through the US division of Kakao Entertainment.
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