While BTS is on hiatus, Hybe is reportedly raising $380 million from investors to fund global acquisitions

Photo credit: HYBE

Four months after Scooter Braun took charge of his U.S. business, BTS agency Hybe is reportedly looking to raise nearly $400 million to fund an acquisition-intensive global expansion.

The Seoul-based company’s search for investor capital and a larger international footprint was highlighted in a recent report by Bloomberg. In February, Hybe acquired Atlanta’s Quality Control for a reported $300 million, and executives underlined their plans to transform their company into “a truly global entertainment platform rooted in music” when announcing the deal.

While a subsequent attempt to acquire rival K-pop company SM Entertainment didn’t bring the desired result for Disney partner Hybe, the company appears to be continuing to seek to reach more fans in various markets. According to the aforementioned report, larger companies are targeting “around” 500 billion yen ($382.44 million at the current exchange rate) in equity financing from investors, although the exact size and terms of the deal are still uncertain.

At the time of writing, Hybe, owner of Ithaca Holdings, does not appear to have commented publicly on the rumored plan to raise additional capital for acquisitions. However, the K-pop star is reportedly considering buying a well-known label in the fast-growing Latin music space and/or a maximum of two US companies that are well-positioned on the production side.

When trading ended today, Hybe shares (KRX: 352820) were worth ₩270,000 ($206.77) per share, down 2.70 percent from Thursday’s close. (Separately, several Hybe employees have faced insider trading allegations related to BTS members’ military service.) Still, the stock, along with several other leading K-pop companies, has risen significantly since the start of 2023 on revenue growth continues to increase for the BTS members Supertone owners.

With K-pop exploding in popularity across the board, Hybe isn’t the only one spearheading aggressive expansion campaigns and building new groups.

It was announced yesterday that JYP Entertainment (KRX: 035900) had signed an expanded collaboration with Universal Music Group’s Republic Records in anticipation of “the next K-pop explosion.” With sales of ₩345 billion (US$264.34 million) for 2022, up from ₩193 billion (US$147.88 million) in 2021 and just ₩15 billion (US$11.49 million) in the Year 2012 – JYP recorded sales of ₩118 billion (US$90.41 million) in the first quarter of 2023. .

Meanwhile, the aforementioned SM Entertainment – which is grappling with a contract dispute between three members of its popular EXO group – signaled last month that it and Kakao are seeking their own acquisition in North America.

“We are discussing strategies for entering North America with Kakao Entertainment,” CEO Jang Cheol-hyuk said, according to Google’s Korean language translation of his remarks. “We are considering an acquisition, although it is still difficult to disclose details.”