HYBE announces they will no longer acquire SM Entertainment KossyDerrickBlog KossyDerrickEnt


Your favourite Entertainment Blog for trending Gist, Celebrity News and gossip, food and Hollywood Celebrity news. For advert and sponsored post, contact: [email protected]


Breaking News

Search This Blog

Before you used this banner


Sunday, March 12, 2023

HYBE announces they will no longer acquire SM Entertainment

HYBE announces they will no longer acquire SM Entertainment.

HYBE has announced that it “will discontinue the acquisition process of SM Entertainment.”

On March 12, HYBE released an official statement announcing the end of its highly public battle with Kakao over acquiring shares of SM Entertainment.

Last month, HYBE signed a deal with SM Entertainment founder Lee Soo Man to acquire a 14.8 percent stake in the company, making them the largest shareholder. The deal came in response to Kakao’s attempt to purchase a 9.05 percent stake in SM Entertainment by buying newly issued shares and convertible bonds—an attempt that Lee Soo Man denounced as illegal and which he successfully blocked by taking SM Entertainment to court, where his request for an injunction was granted.

With SM Entertainment legally banned from issuing new shares or convertible bonds to Kakao, the conglomerate moved on to attempting to buy shares from existing stockholders instead. Earlier this week, Kakao made a new tender offer to SM Entertainment shareholders at a higher price than what was recently offered by HYBE.

Two days ago, it was reported that HYBE and Kakao had come to an agreement regarding their battle for management rights and control of SM Entertainment—and it has now been confirmed that the result is HYBE’s withdrawal from the acquisition.

According to a press release, HYBE “made this decision after observing that the market has been showing signs of overheating due to competition with both Kakao and Kakao Entertainment.”

The announcement comes just over a month to the day that HYBE first announced that it had struck a deal with SM’s former chief producer Lee Soo-man to buy his shares and become a majority stakeholder in competing K-pop label SM.

In today’s statement, HYBE said it “acquired former Chief Producer Lee Soo-man’s shares and made the tender offer based on a fair acquisition price range, considering the long-term value of SM, and all costs that may arise during the post-merger integration process”.

“However, HYBE determined that the price of acquiring SM exceeded the fair acquisition price range as the competition with both Kakao and Kakao Entertainment intensified. HYBE contemplated the possibility that this acquisition, along with the tender offer, may harm shareholder value, and fuel overheating of the market, in making the decision.”

No comments:

Advertise With Us