Putting an end to a weeks-long takeover battle with social media giant Kakao, Hype has withdrawn its plan to take control of K-pop, and will permit Kakao to inflate its entertainment business further.
Hybe said its decision to terminate the takeover bid came after the price to obtain SM exceeded a fair range as the competition escalated.
In the previous week, Kakao launched a 1.25 trillion won ($946.80 million) tender bid, which is up to 35% of SM Entertainment at 150,000 won per share, well above the 120,000 won per share offer from Hybe seeking a 25% stake, but eventually it gained little traction with bondholders.
Besides Friday, shares in SM Entertainment were halted at 147,800 won.
Hybe mentioned after talks with Kakao that both companies have agreed to conspire on matters related to their platforms.
Lee Jong-im, a pop culture expert and critic, mentioned the takeover of SM as the latest in a series of efforts by Kakao to expand its content and entertainment arm in recent years.
In 2021, Kakao Corp obtained multiple content companies, which include video game developer NFLY STUDIO.
Further, Kakao Entertainment, an auxiliary of Kakao, also invested 12 billion won in Metaverse Entertainment, which specialises in digital idol groups.
“Kakao and Kakao Entertainment will continue their tender offer bid until the 26th to secure a further stake and work on the details of business cooperation between HYBE and SM,” Kakao stated.
Kakao and SM Entertainment said they honoured Hybe’s decision to drop its bid and end the takeover battle between them.
- Published By Team Genuine Reporter