SM Entertainment (SME) will sell KeyEast, its drama production and actor management grandchild company. It has been about 7 years and 7 months since SM Entertainment acquired KeyEast in 2018.
According to the Financial Supervisory Service on the 17th, SM Studios and SMEJ Holdings, the largest shareholders of KeyEast, will sell 33.71% (6,590,251 shares) of KeyEast equity. The sale price is 5,160 won per share, for a total sale price of 34.0 billion won.
SM Studios and SMEJ Holdings are 100% subsidiaries of SM Entertainment. The two companies hold 28.83% (5,547,873 shares) and 5.33% (1,042,378 shares) of KeyEast, respectively. In effect, KeyEast is a grandchild company of SM Entertainment.
The buyer is Iro Investment Association No. 1. Iro Investment Association No. 1 paid a 3.4 billion won deposit that day, and will become the largest shareholder of KeyEast if it pays the remaining 30.6 billion won on Dec. 4. The representative and executive partners of Iro Investment Association No. 1 are Kim Mun-gyeong and Kim Jeong-tae, who are known as professional investors primarily active in the KOSDAQ market.
SM Entertainment has been pushing the sale of KeyEast since last year as part of its effort to dispose of noncore assets. Early this year, it selected Cheongdam Investment and KNT Investment as preferred bidders, but it did not lead to a transaction.
Meanwhile, KeyEast's main businesses are producing cultural content and managing entertainers. Representative artists under its label include Kim Hee-ae, Bae Jeong-nam, Cha Seung-won, and Kang Han-na. Its produced dramas include "When the Stars Gossip," "The School Nurse Files," and "Something in the Rain."