CJ confirms interest in acquiring SM Entertainment - The Korea Times
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CJ confirms interest in acquiring SM Entertainment

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SM Entertainment Founder Lee Soo-man / Courtesy of SM Entertainment
SM Entertainment Founder Lee Soo-man / Courtesy of SM Entertainment

By Kim Jae-heun

Local entertainment giant CJ ENM confirmed its interest in acquiring the iconic K-pop agency SM Entertainment, Thursday.

"CJ ENM has opened a lot of possibilities. It's true we are in discussions with a lot of entities, but we can't open up on the specifics or the target companies we are talking with. Regarding CJ ENM's possibility of acquiring a stake in SM Entertainment, nothing has been decided on yet for the time being," a CJ ENM official said.

According to entertainment industry sources, CJ ENM was planning to spend between 600 billion won and 700 billion won to acquire the 18.73 percent stake in SM Entertainment owned by founder Lee Soo-man. CJ ENM calculated the stake valuation by estimating SM's corporate value at somewhere between 3 trillion won and 4 trillion won.

Despite the stake sale, Lee, who is also the largest shareholder in the country's top talent agency, is set to keep leading the agency. CJ ENM plans to separate its music business unit once its stake acquisition in SM is completed.

Regarding this, SM Entertainment said it was in talks with various companies for a partial stake sale. Kakao has also been mentioned as another candidate to take over SM Entertainment. But sources said Kakao, which operates the country's top mobile messenger KakaoTalk, is set to drop its bid as it has been coming under severe public criticism for its aggressive expansion into various unrelated fields.

Kim Jae-heun jhkim@koreatimes.co.kr

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