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Band BTS performs during the 2020 MTV VMAs in this screenshot image available on August 30, 2020. (VIACOM / Handout via Reuters)
SEOUL – Members of popular South Korean K-Pop band BTS are expected to become billionaire shareholders after receiving shares from their label, Big Hit Entertainment, as they prepare an initial public offering (IPO) that could raise up to 962.6 1 billion won (609.35). million pounds).
This week, BTS got Korea’s first no. 1 spot on the US Billboard Top Music Chart with the uplifting hit album “Dynamite.” Her first English-language single hit the spot for fans of American pop, with a YouTube video that has already garnered more than 284 million views.
Big Hit CEO and largest shareholder Bang Si-hyuk last month handed over 478,695 ordinary shares to the seven BTS members, or 68,385 each, “to strengthen the long-term partnership with leading artists and elevate morality, “Big Hit said in a regulatory filing on Wednesday.
Each member of BTS would get 9.23 billion won in stock, or 64.6 billion won in total, if the IPO price is at the top of its range in October.
The giveaway of stock can be interpreted as an attempt to bring BTS members and the label closer together, said Kim Hyun-yong, an analyst at eBEST Investment & Securities.
Big Hit plans to offer around 7.1 million shares at an indicative price of between 105,000 and 135,000 won per share.
The price potentially values the company at up to 4.8 trillion won ($ 4.04 billion), considering convertible preferred shares plus common shares, analysts said.
“The stock could perform well when listed as there is now a lot of liquidity in the market … So it depends on the Big Hit results, but the lack of physical concerts due to COVID-19 will likely have a negative impact,” said Nam Hyoji, an analyst at KTB Investment and Securities.
Big Hit is heavily reliant on BTS, with 87.7% and 97.4% of its revenue in the first half of 2020 and 2019, respectively, coming from the group, according to the document.
With BTS members expected to enter mandatory military service for South Korean men in the coming years, the label has worked to address market concerns that it needs to diversify its income streams.
“There is the military problem, but if there is no legal exemption, Big Hit is expected to establish units with the remaining members or perform solo acts while serving in the military,” said Kim Hyun-yong.
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