South Korean internet giant Kakao has received a conditional approval from the country’s antitrust regulator to acquire a controlling stake in K-pop agency SM Entertainment.
The approval for Kakao, and its subsidiary Kakao Entertainment, to increase its ownership of SM Entertainment to 39.87 per cent comes a little under a year after news that the internet giant made a bid to become the K-pop agency’s largest shareholder.
According to Korea JoongAng Daily and The Korea Herald, South Korea’s Fair Trade Commission (FTC) has placed two conditional measure that aim to address concerns over Kakao’s acquisition of a controlling stake in SM Entertainment.
Per Korea JoongAng Daily, the internet giant is prohibited from refusing or delaying music supply requests from its competitors without reasonable grounds and also has to establish an independent body to monitor Kakao s potential favouritism towards its streaming platform.
“It is the first case that the FTC ordered corrective measures as conditions for a corporate merger in the entertainment field,” the FTC said, per The Korea Herald. “We will continue thoroughly review corporate merger cases to ensure fair competition and to prevent damage to customers.”
Kakao had purchased the additional shares of SM Entertainment in March 2023, after HYBE dropped its bid to acquire the K-pop agency following a discussion with the internet giant.
The news also comes amid an increasingly heated and public battle between ADOR CEO Min Hee-jin and HYBE, which owns majority shares in the K-pop agency, over the ownership of the NewJeans label.
The post Kakao gets greenlight to acquire controlling stake of K-pop agency SM Entertainment appeared first on NME.
