As long as the BTS money keeps coming they have nothing to worry about

Quote from Blue2012

Hybe's Debt-to-equity is extremely high. Just in the last week they've spent $600 million on a small hip-hop label in the US and a 15% stake in SM.

They've gone into high debt buying small labels like Pledis over the years.

For example, YG's Debt-to-Equity is 2.9%, which is really good.

Hybe is 30.8%.

A healthy ratio is around 6% or lower.

So Hybe's debt I'd extremely alarming.

Hybe has also never paid a dividend to stock holders, YG and JYP have every year except 1. So again, not good.

Also this article came out today.

Hybe's tender offer to SM minority owners just got more expensive and I doubt they'll have the ability to match and the offer is going to get rejected.

SM share price surpasses 130,000 won... Hive tender offer price likely to rise

Reporter Lee Jae-bin2023-02-16 16:05

The meaning of the 120,000 won tender offer disappears as the stock price soars

Excluding transfer tax for tender offer, the average is in the mid-110,000 won range

Kakao's 140,000 won tender offer Hive is in trouble when it counterattacks

When the tender offer fails, the fight for equity... A boon for minority shareholders

As SM's stock price soared, a red flag was turned on for Hive's stock tender offer. In order for Hive to successfully secure a stake in SM, the tender offer price must be raised to more than the previously suggested 120,000 won, but it is difficult without additional financing. Conversely, if Kakao makes a tender offer, Hive's plan to secure a stake through a tender offer is highly likely to fail completely. If the stock price continues to rise, it is expected that the two sides will enter into a showdown through a shareholder-friendly proposal rather than a tender offer.

According to the Korea Exchange on the 16th, SM stock price closed at 131,900 won, up 9,300 won (7.59%) from the previous day. The stock price, which started at 124,900 won, up 2,300 won (1.88%) from the previous day (122,600 won), rose to 133,600 won during the day, soaring nearly 10%.

As the stock price soared, the emergency light was on for Hive. Previously, on the 10th, Hive announced that it would acquire 3,423,420 shares owned by Lee Soo-man, SM's largest shareholder, at 120,000 won per share, and would make a tender offer for up to 5,951,826 shares at the same price. The total acquisition amount is 422.81 billion won and 714.2 billion 19.12 million won, respectively, for a total of 1.137 trillion won. The problem is that as the share price exceeded 120,000 won, the possibility of individual investors responding to the tender offer is rapidly decreasing. If the share price exceeds 120,000 won by March 1, the deadline for the tender offer, individual investors are unlikely to respond.

In addition, CEO Lee claimed that in the new year, Lee Soo-man put his aides at the forefront and demanded ▲ announcing a statement that the artist needed Soo-man Lee ▲ a contract with CTP for an overseas production album ▲ and devising measures to delay the release of the album after April.

It was also revealed that the comeback of the girl group Espa was delayed because of Lee Soo-man's interest in tree planting.

Representative Lee said, “Aespa’s new album was scheduled to be released on February 20th.” “Lee Soo-man, by the way, told the A&R (Artist and Repertory) team and Director Yoo Young-jin that all major songs from SM had to plant trees in the lyrics and sustainability. (Sustainability) and ESG (Environmental Social Governance).”

He then said, "I ordered to sing a song with lyrics that project tree planting that does not suit the group aespa with a well-crafted worldview." ', 'Co-existence', 'Greenism' were included, and the word 'planting a tree' appeared directly in the lyrics at an early stage, making the members of the Espa upset and emotional."

Representative Lee explained, however, that he had requested that the direct word 'planting a tree' be omitted. However, with such unreasonable instructions, 'no one can sympathize'

CEO Lee said, "Behind the message of tree planting, sustainability, and ESG, and the call for new market development and cultural exchange, there is Lee Soo-man's desire for real estate business rights." “It was only possible through this, so there was a situation where we had to coordinate it,” he said.

CEO Lee said, "Now, we, SM, will start all over again. That's 'SM 3.0'. Please listen to our SM's music again."

Former Executive Producer Lee Soo-man has not yet released a position on this video.

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HYBE has already bought LSM's shares. Even if they don't get the other shares, they have nothing to lose. They can even sell their new shares and wash their hands with a profit of 15% because the prices have gone up so much. Let's also note that the debt they receive is short-term. So the state of the company is THAT GOOD. As long as they have BTS, I don't think they will have a problem with money.

suga future tour paying probably

Quote from byakuyav

They can even sell their new shares and wash their hands with a profit of 15% because the prices have gone up so much.

Not quite sure this is true - speculation is that Kakao-aligned forces are driving up SM's stock price right now probably for the purpose of preventing Hybe from acquiring a bigger stake in shares. If Hybe wanted to divest 15% of its shares, it wouldn't be selling at current stock price - could be higher, could be lower, but it would likely be to a fixed price to a specific buyer, not on open market because the current open market price is being artificially inflated. So it depends after all the antics that SM has gone through in the past few weeks, who'd be willing to buy and for how much. The way that both Kakao and Hybe are gritting their teeth, seems like reversing major stock decisions would also be costly.

Quote from pchromo4

Not quite sure this is true - speculation is that Kakao-aligned forces are driving up SM's stock price right now probably for the purpose of preventing Hybe from acquiring a bigger stake in shares. If Hybe wanted to divest 15% of its shares, it wouldn't be selling at current stock price - could be higher, could be lower, but it would likely be to a fixed price to a specific buyer, not on open market because the current open market price is being artificially inflated. So it depends after all the antics that SM has gone through in the past few weeks, who'd be willing to buy and for how much. The way that both Kakao and Hybe are gritting their teeth, seems like reversing major stock decisions would also be costly.

Kakao is inflating SM share prices to prevent HYBE from buying more shares, that's true. However, there is one thing that will not change, that HYBE has already bought 18% of the shares and will most likely take the remaining shares of LSM. In any case, HYBE got what it wanted. Kakao is currently have around 10% and raising as many shares as HYBE has become even more difficult for them after their recent inflating. Kind of a double-edged sword. They will have to bid at an inflated price themselves, while blocking out their competitors.