Earlier this month we wrote about K-Pop giant Hybe acquiring a 14.8% stake in fellow South Korean music firm SM Entertainment. However, it seems the current management of the latter company are not happy with the move.
Chief financial officer Cheol Hyuk Jang took centre stage in a video published to YouTube yesterday explaining “why SM is against Hybe’s hostile takeover”. He noted that while the 14.8% stake was sold to Hybe voluntarily [by SM founder Lee Soo Man] the company sees this as the start of a “hostile takeover attempt” by the other company, with Hybe seeking to take a larger 40% stake in SM.
The CFO did not hold back. “Hybe’s CEO said he will ensure independent management of SM, but I can tell you how empty this promise is, and how difficult that promise is to keep,” he said.
SM is also bridling at the potential for its artists’ releases to be deprioritised compared to Hybe’s, and concerned that it may be forced to use the other company’s fan platform Weverse rather than to develop its own.
“Hybe’s acquisition of SM will undermine fair competition,” he concluded, warning that “K-Pop would lose opportunities for a greater advancement forward” as a result.
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