KAKAO ENTERTAINMENT DENIES RUMORS OF SM MERGER

They said nope.

On March 11, a Kakao Entertainment representative addressed rumors that the company would acquire SM Entertainment.

"We have considered various modes of working with SM Entertainment, including a cooperative business partnership, investment, etc., but nothing has been confirmed," Kakao said on this day.

Rumors of SM Entertainment being acquired by entertainment conglomerates like Kakao Entertainment and CJ ENM have been circulating since 2020. Previously, it was reported that SM Entertainment founder and chief producer Lee Soo Man had put up for sale approximately 18.7% of his shares.

An earlier report claimed Kakao had offered Lee Soo Man up to 1 trillion KRW ($800 million USD) for his shares, the highest percentage owned by a single party in SM Entertainment.

Insiders say Lee Soo Man sold his SM Entertainment stock due to the high business tax associated with retaining management rights.