Lee Soo Man’s grandson Lee Sung Soo and co-CEO of SM Entertainment, denounces Lee Soo Man & Bang Si Hyuk’s latest move as a ‘hostile acquisition’
On behalf of co-CEOs Lee Sung Soo and Tak Young Joon, SM Entertainment has issued a statement of response to earlier reports that HYBE has successfully acquired 14.8% of SM Entertainment’s shares.
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The agency’s statement read,
“This statement reflects the collective positions of 25 chief directors at SM Entertainment, including co-CEOs Lee Sung Soo, Tak Young Joon, as well as all other officers who hold positions above division chief.
Back on February 3, SM Entertainment announced plans to enter its new, key phase ‘SM 3.0′, transitioning from a single producer to a multi-production/multi-label system. But as soon as this new phase was announced, it is being reported that hostile merger and acquisition attempts are being carried out, attempts which not only undermine SM’s much deliberated decision, but also the values of SM Entertainment which it has built up alongside its artists all these years.
SM Entertainment is a company made up of approximately 600 employees, working hard each day in the hopes of raising SM Entertainment’s status to that of the #1 entertainment company. It is also a company which, on the basis of its employees’ efforts, has led the K-Pop industry proudly until this day. With the new phase ‘SM 3.0’, SM Entertainment planned to once again take its next steps toward becoming a leading company in global entertainment with the support of fans and shareholders, and as such, we would like to deliver the firm position that every employee of SM Entertainment, every artist, strongly disapproves of any and all hostile acquisition attempts from the outside.
The strategic partnership between SM Entertainment and Kakao, publicly announced on February 7, marks a move in securing the necessary components to fulfill ‘SM 3.0’. The partnership is sure to demonstrate a powerful synergy effect in strengthening the global reach of SM’s IP content with various applications. This vision for a mutually beneficial strategic partnership has been discussed and agreed upon thoroughly with Kakao. Thus, we would like to stress that the strategic partnership with Kakao was a management decision which we felt was necessary for the fulfillment of ‘SM 3.0’, and thus the partnership plays no significant role in the so-called ‘management battle’ which our company’s largest shareholder insists on undertaking.”
Meanwhile, HYBE Labels intends on acquiring up to 40% of total shares in SM Entertainment by March 1 with strong support from founder Lee Soo Man, setting its sights on obtaining significant control of SM Entertainment’s operations.
