Industry officials confirm SM has been acquired by Kakao + Lee Soo-man sells all his shares

Article: [Exclusive] SM's new owner is Kakao..."Leap to 'Big 2' after HYBE"

Source: Hankyung

It has been confirmed that Kakao's acquisition of SM Entertainment is imminent.

According to investment banking industry officials on the 11th, Kakao has come to an agreement with SM to acquire all of CEO Lee Soo-man's shares (18.72% stake) in the company and Lee Soo-man is set to make an official announcement. 

CJ ENM was a strong potential buyer originally however Kakao offered to pay two to three times more of SM's current stock price for a closing price of up to 1 trillion won. 

Kakao aims to maximize its pre-IPO corporate value with the acquisition and will actively utilize SM's intellectual property (IP) to develop new businesses, enter key overseas markets such as the U.S and recruit talent. The industry predicts Kakao's synergy will be maximized with their acquisition of SM.

Analysts believe Kakao can secure 20% of the domestic entertainment agency market and leap directly to 'Big 2' after HYBE (33%). 

Kakao did not deny the rumors of the acquisition revealing in their announcement last year, "We have been continuously considering various measures related to the acquisition of SM to strengthen our competitiveness in the global content business but nothing has been decided in detail."

With the acquisition, SM's largest shareholder will be changed to Kakao. SM also decided to settle on a service contract with 'Like Planning,' a private company 100% owned by Lee Soo-man.

Meanwhile, Lee Soo-man was under controversy after it was revealed 46% of his company 'Like Planning's operating profit came from "consulting" services with SM. 

1. [+2012, -126] So the government isn't going to regulate Kakao at all seeing them sticking their tentacles into everything like this? They're like a bull eating up the whole market..
2. [+667, -76] Probably wanted to finish things quickly while under Moon Jae-in's reignㅋㅋㅋ.
3. [+433, -36] This is why SM insists on taking in Chinese kids. They can't be freed from Chinese money...
4. [+343, -44] Looks like CJ couldn't accept Lee Soo-man's irrational number and strange content since they're a normal content company...but Kakao had no problem biting since they're not clean themselves with all their Chinese money. 
5. [+85, -0] Lee Soo-man is biggest winner in this. He set up his own Like agency and siphoned off all of SM's profits, and now that rumors spread and stock is not going up, he decided to sell the whole company at a high price and eat up all the extra profits. So greedy.. 
6. [+65, -9] SM needs to give up on their Chinese dream. Look at HYBE, they only come out with pure Koreans without a single foreigner and entered the Billboards.. 
7. [+54, -1] Once SM got too big, he realized he couldn't siphon off the company's money so he created his own small company that he 100% owns to filter the profits through...he even got a premium from Kakao for selling his stake in SM on top of it ㅋㅋ
8. [+47, -4] Lee Soo-man's Chinese dream is unrivaled. In the end, he sold SM off to Chinese.
9. [+39, -3] Personally, I think CJ not taking over SM was for the best...the management risk is too big. They can make high quality content with money they planned to use to acquire SM.
10. [+32, -14] Isn't HYBE basically dead once BTS disbands?