Byeong-gyu Jo (50, 29th class of the Judicial Research and Training Institute), an in-house lawyer at SM Entertainment, complained that Kakao was attempting a hostile M&A.
On the 13th, Beomnyun Newspaper reported an explanation from SM executives and employees containing the relevant information. In the explanatory statement, lawyer Cho Byeong-gyu said, "Management rights covered by the Commercial Act or the Capital Markets Act refer to the power to appoint registered directors and form a board of directors through a general shareholders' meeting."
He continued, “The audit recommendation of the proposed shareholder (Align Partners), which has been happening since last year, and the inauguration and activities of the auditor appointed as a result, can be said to be a dispute situation between a shareholder called Align and a major shareholder called (Lee Soo-man).” revealed.
Attorney Byeong-gyu Cho said, “Following the agreement between Align and the current management on January 20, there is a management rights dispute between Align + the current management vs. Teacher (Lee Soo-man),” adding, “With Kakao owning a 9% stake, Align He explained, “The fact that Hive took the side of the current management and the fact that Hive acquired Teacher (Lee Soo-man)’s shares and announced that it would acquire close to 40% of the shares through a tender offer are all situations of a management rights dispute.”
Additionally, Kakao was selected as the identity of the hostile M&A force. Attorney Cho Byeong-gyu said, "It is Kakao that is currently attempting a hostile M&A, not Hive. Rather, Hive is conducting a friendly M&A, and the party that wants to increase its stake against the will of the majority shareholder is Kakao, and Hyun-hyeong, which is joining hands with Kakao, “It’s in alignment with management,” he claimed.
In addition, he mentioned, "When hearing the improvements requested by Align from the current management, (Lee Soo-man) expressed the opinion that it was reasonable for him, as the majority shareholder, to accept most of them."
Lastly, "CEO Seong-soo Lee and CEO Young-jun Tak looked at the screen and said goodbye to the teacher (Soo-man Lee). While explaining to the executives and employees that all of this was done for the teacher, they actually did not say a word, a phone call, or a phone call to the teacher himself. “They say there wasn’t even a letter.”
Reporter Junho Yoon, Ten Asia delo410@tenasia.co.kr