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Kakao becomes SM’s 2nd-largest shareholder

By Kim Hyun-bin hyunbin@koreatimes.co.kr

Kakao secured a 9.05 percent stake in SM Entertainment, becoming its second-largest shareholder, the company said Tuesday. Kakao is joining hands with SM Entertainment to strengthen its competitiveness in the music and content business.

SM Entertainment issued 1.23 million new shares in the form of a paid-in capital increase, while Kakao secured 1.14 million shares of SM through the acquisition of convertible bonds. The total acquisition was worth over 217 billion won ($172.7 million).

In addition, Kakao signed a threeway business agreement with Kakao Entertainment and SM Entertainment. The three companies plan to take the lead in raising the global status of Korean pop culture.

“Through this investment and cooperation, we expect that the two companies will be of great help to each other in responding together to the fierce competition in the global music and content market and targeting the global mainstream of K-content. Through multifaceted cooperation, we will contribute to the expansion of K-culture’s global influence.” said Bae Jae-hyeon, executive vice president of Kakao Corp.

The company expects the synergy to be great as Kakao Entertainment has intellectual property value chains such as planning and production capabilities, platforms and artists that encompass stories, music and media, and SM is backed by the global K-pop craze.

Through this investment and cooperation, Kakao Entertainment and SM Entertainment are promoting global management business together by utilizing their networks, such as the overseas partners of each company, and working together to strengthen intellectual property competitiveness by working together to create new K-pop acts through global auditions.

Kakao also plans to continue collaborating on various businesses including the production and distribution of global albums. The three companies are jointly preparing for future businesses by utilizing technological prowess obtained by Kakao including artificial intelligence (AI) technologies.

National

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2023-02-08T08:00:00.0000000Z

2023-02-08T08:00:00.0000000Z

https://thekoreatimes.pressreader.com/article/281706913837973

The Korea Times Co.