HYBE will offload its 15% stake to its South Korean rival, marking an official end to the bidding war that erupted over SM.
Chairman Bang Si-hyuk says HYBE must have a “sense of urgency” in efforts to grow outside its home country.
The agency behind BTS said it was still studying possible avenues for collaboration with SM, once South Korea’s dominant K-pop company.
The agency that created BTS is embroiled in a public struggle with SM’s powerhouse founder Lee Soo-man. Will it end with a cliffhanger?
The companies are wrestling for control of SM with competing board slates at the March 31 annual meeting in Seoul.
The announcement came a day after a court injunction forced Kakao to cancel its plan to acquire a 9.05% stake directly from SM.
Tech giant Kakao had agreed to buy shares as part of a partnership agreement, which SM founder Lee Soo Man opposes; he turned to rival HYBE instead.
HYBE, which owns a 14.8% stake in the competing K-pop company, criticized the tie-up with tech company Kakao as one-sided and harmful to shareholders.
Concert revenue grew tenfold for the NCT Dream and Red Velvet label, while recorded music sales declined 3.7%.
Last year, HYBE's increasingly diversified business was nearly balanced between its three largest markets: Korea (33% of revenue), North America (32%) and Japan (28%).
