Seoul/Hong Kong
Act Daily News
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HYBE, the administration company behind celebrity boy band BTS, will develop into the largest shareholder of its Ok-pop rival, SM Entertainment.
The transfer strengthens HYBE’s dominance in South Korea’s music trade, the place it’s already the largest participant, even because it seeks to develop overseas.
The South Korean leisure giants introduced the deal Friday, with HYBE set to choose up a 14.8% stake in SM Entertainment for 422.8 billion Korean gained ($334.5 million).
SM was based by legendary music producer Lee Soo-man, who’s broadly referred to in South Korea as “the godfather of K-pop.” The firm is understood for representing hit artists, comparable to NCT 127, EXO, BoA and Girls’ Generation.
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News that the 2 firms had been becoming a member of forces fired up traders. SM Entertainment’s shares soared 16% in Seoul on Friday. HYBE’s inventory initially rose 3%, earlier than paring features to shut down 1.5%.
Outside of BTS, HYBE additionally represents distinguished bands comparable to NewJeans, Tomorrow x Together and Seventeen.
But its marquee act is at the moment on hiatus. Members of BTS began particular person obligatory army service in South Korea late final yr, and the group as a complete is predicted to reconvene round 2025.
Now, HYBE is popping its consideration elsewhere.
“This acquisition represents a major step by HYBE to integrate the global expertise of both companies to become a game changer in the global music industry,” the corporate mentioned in an announcement.
HYBE has been taking steps to develop its world attain. On Thursday, it introduced one other main deal within the United States, saying it might purchase the proprietor of Quality Control, a hip-hop label that represents common artists together with Migos and Lil Yachty.
That deal will assist HYBE construct a stronger presence within the US music market, in keeping with Sunhwa Lee, an web and leisure analyst at KB Securities. In a report Thursday, she famous that the corporate’s broader ambitions had been “to go beyond the boundaries of K-pop and develop new global artists across various genres.”
“This partnership is a vital part of our growth plan to innovate the entertainment industry through a diversified portfolio,” HYBE Chairman Bang Si-Hyuk mentioned in an announcement. “We will work together to continue adding depth of hip-hop to the global music industry.”
Bernie Cho, a Seoul-based music trade govt, mentioned the 2 offers introduced had been not like something he’d seen.
This “may be the biggest one-two power punch I’ve ever seen or heard [of] in the history of the K-pop industry,” mentioned Cho, president of DFSB Kollective, a music artist and label providers company.
He mentioned the offers had the potential to place HYBE in the identical league because the “big three” main document labels: Sony
(SNE), Universal and Warner Music.
“HYBE, in their post-BTS stage, have really stunned and surprised fans and financial analysts by really smart, really savvy huge deals,” he added.
In 2019, BTS accounted for as a lot as 90% of income at its administration firm, then generally known as Big Hit Entertainment. That left analysts involved that the agency, later renamed to HYBE, was overreliant on the band.
Since then, nonetheless, HYBE has expanded its roster.
In current years, its slate has grown to incorporate different world celebrities, together with Justin Bieber, Ariana Grande and Demi Lovato, who’re represented by a staff below HYBE’s US subsidiary.
The South Korean agency has additionally has a tie-up with Big Machine Label Group, an affiliate that oversees among the high artists in nation music, comparable to Sheryl Crowe, Rascal Flatts and Tim McGraw.
“HYBE is no longer a K-pop juggernaut. The K has now become silent,” mentioned Cho. “They’ve become a pop music juggernaut.”
Source: www.cnn.com