Kakao Claims Not Selling SM But Rumors Of Potential Buyers Including HYBE & Lee Soo-man Continue To Emerge

According to insiders on February 2nd, as many as 8-9 Strategic Investors and Financial Investors are considering acquiring SM. 

First of all, Chairman Bang Si-hyuk of HYBE, which lost to Kakao in the acquisition battle last year, is said to have offered to buy SM through some private equity fund (PEF) companies. An insider said, “Chairman Bang believed that it wouldn’t look good if he directly participated in the acquisition so he offered financial investors to join him”.

Next, MGM, which had a collaborative relationship with SM Entertainment in the past, recently proposed their intention to acquire SM to Kakao. There’s a rumor that Kakao officials even went to the US to meet with MGM executives. However, Kakao already denied this information.

Clothing company F&F, which has steadily been making operating profits of 100 billion won every quarter, is also interested in acquiring SM. They established the subsidiary F&F Entertainment last year and entered the K-pop market. If the company acquires SM, they will quickly rise to the top in the industry.

NCSoft, the gaming company that created the fandom platform Universe but already merged it with SM’s Dear U, was also named among potential companies to acquire SM but it is known that they no longer want to invest in K-pop businesses. In this regard, an insider believed that NCSoft didn’t have enough money to acquire SM.

In addition, there is also a high possibility that former SM’s executive producer Lee Soo-man is also finding ways to rebuy SM after selling all of his SM shares to HYBE last year. The court recently accepted his request to review the board meeting minutes of SM and attached materials from February to August, hinting at the re-examination of the management dispute. However, it is not easy for him to take back his stake in SM as Lee Soo-man already paid a large amount in transfer tax when selling his shares to HYBE.