Acquisition of DearU Shares Worth 135.6 Billion KRW
Becomes a Consolidated Subsidiary
SM Entertainment (SM) will acquire an additional 11.4% stake in fan communication platform company DearU, making it a consolidated subsidiary.
On the 21st, SM Entertainment announced that it will acquire 2,711,351 shares of DearU for approximately 135.6 billion KRW. The scheduled date for the stock acquisition is the 24th of next month, and after the acquisition, SM Entertainment's stake in DearU will be 11.4%.
SM Entertainment’s subsidiaries, including SM Studios, SM Japan, and Everysing Japan, currently hold a 33.7% stake in DearU. With SM Entertainment’s additional acquisition of an 11.4% stake, the company plans to strengthen its management control and maximize synergy between the two companies.
An SM Entertainment official explained, "This decision is part of SM’s ongoing 'SM 3.0' strategy," adding, "It aims to strengthen the fan platform as a core business for expanding the IP business."
DearU operates the messaging service "Bubble" between artists and fans. As of the end of the third quarter last year, it had secured 2 million paid subscribers. There are 157 agencies and about 600 artists using Bubble.
Through this additional stake acquisition, SM plans to strengthen its business integration with DearU and create synergy between the entertainment and fan platform businesses. JYP Entertainment, which holds a 10% stake in DearU, will continue its existing business cooperation with DearU as a major shareholder even after this stake change.
Jang Cheol-hyuk, co-CEO of SM, stated, "This additional acquisition of DearU shares is an important decision to expand the IP business pursued by the SM 3.0 strategy," and added, "We will maximize business synergy with DearU to further strengthen competitiveness as a global fan communication platform."
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