A series of high-profile deals in the entertainment world are furthering the K-pop industry’s reach as companies continue to expand globally as music powerhouses.
On April 2, Hybe, formerly Big Hit Entertainment, announced that it would be merging with Scooter Braun’s Ithaca Holdings for a reported US$1 billion (S$1.3 billion). Hybe, best known as the home of BTS, acquired a 100 per cent stake in the American company and its properties, which includes entertainment and media firm SB Projects and clients including Justin Bieber and Ariana Grande.
With the Braun deal, Hybe has now become one of the biggest power players in the global entertainment world. The acquisition is the latest move by the powerful South Korean company to consolidate power within the industry while looking to grow internationally.
The Ithaca acquisition is the latest in many by Hybe over the past few years as the entertainment powerhouse has expanded, growing its role as a leading player in the entertainment world even though for a period in 2018-19 the company only housed BTS and one solo artist, Lee Hyun.
As of April 13 – six months since Big Hit went public in October 2020 – Hybe houses multiple music, entertainment and technology companies, with a multitude of artists and subsidiaries under its auspices, plus deals with numerous other major companies and brands, including K-pop company YG Entertainment, home to Blackpink.
Along with Hybe’s big move, the last few weeks have seen major deals and corporate restructuring, much of which is reflective of K-pop companies seeking to grow globally largely through mergers and acquisitions, while narrowing competition in the scene by investing in competitors.
On March 31, RBW Entertainment, home to the likes of K-pop acts including popular girl group Mamamoo and boy band Oneus, announced it had acquired 70 per cent of WM Entertainment, which has stalwart acts Oh My Girl, B1A4 and ONF. By combining their rosters through the deal, the two mid-tier companies amped up their share in the K-pop scene.
According to reports, RBW’s CEO Kim Jin-woo emphasised how the two companies joining together can result in them leading “K-content” cultural growth across the world, while emphasising the intent for further international expansion.
Additionally, SM Entertainment, home to acts like NCT and Exo, also recently announced it had been restructured, launching SM Studios on April 5. SM Studios is a controlling subsidiary that incorporates several of SM Entertainment’s current businesses.
This includes various entertainment brands and related companies, bringing each company’s shares into the solo brand, SM Studios. The company has restructured several times over the last few years, including shifting around its executive staff.
The point of creating the affiliated SM Studios is to refocus the company’s businesses on the music industry, the original foundation of SM, with the intent of making the brand more competitive.
Larger K-pop companies with sizeable talent rosters and well-structured businesses have been less hurt by the Covid-19 pandemic than many others, with the industry transitioning to wholly digital events to replace touring.
Smaller brands, meanwhile, struggle to stay afloat and as the pandemic continues, more acquisitions and corporate changes are expected.
This article was first published in South China Morning Post.