BTS company HYBE ends takeover battle for Okay-pop pioneer SM Entertainment

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Hong Kong/Seoul
CNN
 — 

BTS company HYBE says it has known as off a takeover bid for SM Entertainment, ending weeks of company mudslinging that has dominated headlines in South Korea.

HYBE mentioned Sunday it made its determination “after observing that the market has been showing signs of overheating due to competition with both Kakao and Kakao Entertainment.”

“The company has also taken into account the potential negative impact on HYBE’s shareholder value,” it mentioned in an announcement to CNN.

Last week, tech big Kakao and its leisure unit mentioned that they had doubled down on their quest to take management of SM, the enduring Okay-pop music company. They sought to purchase as much as 35% of the music label, simply days after a earlier share sale settlement between the 2 events was blocked by a South Korean courtroom.

Kakao supplied SM shareholders 150,000 gained ($115) per share, rather more than HYBE’s earlier provide of 120,000 gained ($92) per share, which garnered solely gentle curiosity from traders.

There have been considerations within the business that HYBE’s bid to take a better stake in SM — which is understood for representing hit artists equivalent to NCT 127, EXO, BoA and Girls’ Generation — would unfairly dominate the world of Okay-pop. HYBE Chairman Bang Si-Hyuk had rejected these accusations in an unique interview with CNN’s Richard Quest.

HYBE at present owns 15.8% of SM. That possession is derived from shares gained from its tender provide and its earlier holding of 14.8% bought final month immediately from Lee Soo-man, the founding father of SM and a legendary music producer extensively referred to in South Korea as “the godfather of K-pop.”

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In the Sunday assertion, HYBE mentioned the value of buying SM had “exceeded the fair acquisition price range as the competition with both Kakao and Kakao Entertainment intensified.”

Both corporations have agreed to “cooperate” on issues associated to their platforms sooner or later, it mentioned.

SM Entertainment mentioned in an announcement that it “welcomes” HYBE’s determination to droop its takeover bid.

Kakao and its leisure unit will proceed with their current tender provide to SM shareholders, which is able to wrap up on March 26, they advised CNN.