[Alpha Biz=(Chicago) Reporter Kim Jisun] It has been confirmed that SM Entertainment has decided to entrust Kakao Entertainment with the distribution of its albums and music sources.
Let's go on the 23rd According to the industry and investment banks (IB), SM and Kakao Entertainment signed a business cooperation agreement on the 7th of this month, including provisions related to the issuance and acquisition of paid-in capital increase and convertible bonds.
SM has decided to give Kakao Entertainment exclusive rights to records and music distribution in Korea, and to cooperate with overseas records and music distribution through Kakao Entertainment (including affiliates).
Currently, Dreamus Company, which is a part of SM's stake, is in charge of distributing music and records of SM singers. Kakao Entertainment is in charge of the distribution of music and records such as Ive, MONSTA X, IU, and StayC.
In addition, SM is said to have decided to cooperate to distribute tickets for domestic concerts and fan meetings of its singers through Kakao Entertainment.
SM is also said to have agreed with Kakao to grant preferential preemptive rights to new stocks. If SM issues new shares in a third-party allocation method again in the future, Kakao can receive them first.
Some point out that this could be controversial as SM could increase Kakao's stake if it decides to do so.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
