Big Hit ‘BTS’ Listing … Development Bank Content Investment Fruit

As the initial public offering of Big Hit Entertainment, which belongs to the BTS group, is underway, investment in the cultural content industry by the Korea Development Bank is once again drawing attention.

According to the financial industry, on the 6th, Big Hit took over Pledis Entertainment earlier this year and borrowed 200 billion won from the Industrial Bank as a loan for industrial facilities. The annual interest rate is 1.63% and the loan maturity is available until May 2023.

Big Entertainment is expected to pay off the loan and expand its business through this IPO. It also plans to acquire domestic and foreign record labels and enter the US and Japanese markets. KDB still owns some of the funds invested in Big Hit.

The relationship between the Korean Development Bank and Big Hit dates back to 2011.

Since 2011, the Korea Development Bank has invested a total of 26.9 billion won in Big Hit by creating 4 funds worth 299.1 billion won.

In November of last year, he recovered a total of 2.133 billion won, resulting in a total return on investment of 6.3 times. KDB’s direct investment amounted to 12 billion won, which recovered 77.5 billion won. As KDB still has stakes in two funds, it is worth waiting for additional earnings.

The Korea Development Bank is actively supporting these startups through venture capital (VC) financing.

In the general financial market, it is a way of raising funds in VC by an institution like Sang-Eun that opens up to startups where loans are difficult. After receiving venture capital investments for several years, Big Hit achieved the result of joining Unicorn (corporate value over 1 trillion won) this year.

Sangeun Lee, chairman Lee Dong-geul, said at the first press conference after taking office on the 28th.

President Lee’s comments pointed out that it is difficult to make large-scale investments of hundreds of billions in Korea because the national VC scale is made in the tens of billions.

This means that large-scale investments must be supported to discover and foster new industries, which means that continuous, large-scale investments are necessary for the “second big hit” to emerge.

Meanwhile, on the 5th, Big Hit’s first general investor subscription day, an integrated margin of 8.6242 billion won was raised. The integrated competition rate is 89.6: 1. Subscription to the public offering of shares takes place for two days until day 6.

According to the Financial Investments Association, as of last month 29, the day before the Big Hit subscription, the CMA balance of the securities companies reached 64.93 trillion won, and the final margin is expected to real to double on the first day.

Previously, in the case of Kakao Games, the margin on the first day was raised around 16 trillion won, but the final margin reached 58 trillion won, setting a record.