Stray Kids’ agency JYP denies takeover claims by Japanese investors
JYP Entertainment, the South Korean agency behind K-pop group Stray Kids and TWICE, has denied receiving a valid takeover proposal from Japanese investment group Nexroc, which announced plans to acquire up to 50% of the company.
The dispute escalated on October 29 after Nexroc claimed it had notified JYP about its acquisition plans before making them public. However, the agency said it automatically blocked the email as spam and that it had never formally reviewed a proposal.
South Korea’s Financial Supervisory Service is now monitoring the proposed transaction amid concerns about the investors’ ability to finance the acquisition and its potential impact on JYP’s share price.
«We did not expect such scrutiny from a simple expression of interest press announcement,» Nexroc said, adding that it had contacted both JYP and South Korea’s Financial Supervisory Service (FSS) to clarify the situation.
However, JYP issued another statement later that day, saying the email had been automatically blocked as spam because its sender failed to meet the company’s security standards.
Why is South Korea investigating the proposed takeover?
Nexroc and investment company SVCV announced on October 26 that they were considering purchasing 25% to 50% of JYP’s outstanding shares, potentially offering a 30% premium over a reference share price.
The companies identified November 20 as a possible starting date for the tender offer, although neither has disclosed a final purchase price or submitted the required regulatory documents.
The announcement caused JYP’s shares to jump approximately 14% in after-hours trading on October 26, followed by a gain of more than 6% during the next trading session.
According to Reuters, acquiring a 50% stake could cost approximately $530mn before the proposed premium. Nexroc’s latest reported funding round, by comparison, amounted to $25mn.
JYP founder Park Jin-young held approximately 15.4% of the company as of June, while his combined holdings with related parties amounted to about 15.8%.
