With BTS on Hiatus, Hybe Is Reportedly Raising $380 Million From Investors To Bankroll Global Acquisitions

HYBE insider trading
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HYBE insider trading
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Photo Credit: HYBE

Four months after tapping Scooter Braun to lead its stateside operation, BTS agency Hybe is reportedly looking to raise almost $400 million to bankroll an acquisition-heavy global expansion.

The Seoul-based company’s hunt for investor capital and a larger international presence came to light in a recent report from Bloomberg. February saw Hybe scoop up Atlanta’s Quality Control for a reported $300 million, and execs upon announcing the deal underscored plans to transform their business into “a truly global entertainment platform that is rooted in music.”

While a subsequent attempt to take over rival K-pop firm SM Entertainment didn’t bring about the desired result for Disney-partnered Hybe, the entity is evidently remaining committed to reaching more fans in a variety of markets. According to the mentioned report, higher-ups are specifically seeking “around” ₩500 billion ($382.44 million at the present exchange rate) in equity financing from investors, with the deal’s precise size and terms still up in the air.

At the time of this writing, the Ithaca Holdings owner Hybe didn’t seem to have commented publicly on the rumored plan to generate additional capital for buyouts. But reports have suggested that the K-pop mainstay is considering purchasing a prominent label in the quick-growing Latin music space and/or a maximum of two U.S. businesses that are well-positioned on the production side.

When trading ended today, Hybe stock (KRX: 352820) was worth ₩270,000 ($206.77) per share, reflecting a 2.70 percent dip from Thursday’s close. (Separately, several Hybe employees are facing insider-trading allegations related to BTS members’ mandatory military service.) Nevertheless, the stock, like that of multiple other leading K-pop companies, is up substantially since 2023’s beginning.

Predictably, given K-pop’s across-the-board popularity explosion, Hybe isn’t alone in spearheading aggressive expansion campaigns and developing new groups.

Yesterday, it emerged that JYP Entertainment (KRX: 035900) had inked a bolstered tie-up with Universal Music Group’s Republic Records in anticipation “of the next K-pop explosion.” After reporting ₩345 billion ($264.34 million) in revenue for 2022 – up from ₩193 billion ($147.88 million) in 2021 and just ₩15 billion ($11.49 million) in 2012 – JYP posted ₩118 billion ($90.41 million) in Q1 2023 income.

Meanwhile, the aforementioned SM Entertainment – which is grappling with a contractual dispute involving three members of its popular EXO act – signaled last month that it and Kakao were pursuing a North American acquisition of their own.

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