SEOUL (Reuters) -China’s Tencent Music is expected to become the second-largest shareholder of major K-pop agency SM Entertainment, according to a South Korean filing on Tuesday.
South Korea’s Hybe said in a regulatory filing that it plans to sell its 2.2 million shares in SM Entertainment to Tencent Music Entertainment for 243 billion won ($177 million) on May 30.
The 9.7% stake would make Tencent Music the second-largest shareholder in SM Entertainment, after the 42% controlling stake held by Kakao Corp and affiliate Kakao Entertainment, according to an SM filing.
Tencent Music did not immediately reply to a request for comment. Its shares climbed 2.9% on Wednesday in Hong Kong after the announcement of the deal.
There have been signs of a potential thaw in the unofficial ban on K-pop concerts and performances in China, in place since 2016 after Beijing protested against the deployment of a U.S. anti-missile defence system in South Korea.
Restarting K-pop concerts in China would sharply increase major agencies’ ticket revenue, analysts said.
Hybe, a leading K-pop agency behind supergroup BTS, acquired the SM Entertainment stake in a failed takeover attempt in 2023. Hybe said in its filing that it was selling the stake for “efficient management of investment assets”.
(Reporting by Joyce LeeEditing by Mrigank Dhaniwala and Mark Potter)
