HYBE has announced that it “will discontinue the acquisition process of SM Entertainment.”
- SHINee's Key And Minho Renew Contracts With SM Entertainment
- SM Entertainment And NCT DREAM Alert Fans Of Events Held By Brand Without Their Consent
- RIIZE’s Seunghan Apologizes For Past Actions + SM To Take Legal Action For Circulated Photos
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 agency added, “HYBE contemplated the possibility that this acquisition, along with the tender offer, may harm [HYBE] shareholder value and fuel overheating of the market, in making the decision.”
Not only did HYBE and Kakao reach an agreement regarding SM Entertainment’s management, but they also agreed to “cooperate on platform-related matters” in the future.
Source: Soompi
