Timeline of HYBE's failed bid for SM vs Kakao

(All dates in 2023)

-- Jan. 15: Align Partners Capital Management filed proxy litigation against SM Entertainment Co. Founder Lee Soo-man and seven former board members for allegedly unfair business practices between SM and Lee’s private companies.

-- Jan. 20: SM’s top management, led by Co-CEOs Lee Sung-soo and Tak Young-jun, named Align Partners CEO Lee Chang-hwan as a board member and agreed to increase the number of outside board members, as demanded by the local activist fund.

-- Feb. 7: Kakao agreed to buy a 9.05% stake in SM through new shares and convertible bonds for 220 billion won ($170 million) to form a strategic partnership. The deal was meant to close on March 6.

-- Feb. 8: SM Founder Lee filed an injunction with a Seoul district court to stop SM from issuing shares and convertible bonds that would be bought by Kakao.

-- Feb. 10: HYBE agreed to buy a 14.8% stake in SM from its Founder and top shareholder Lee and announced a tender offer to secure an additional 25% stake in SM by March 1.

-- Feb. 16: SM was said to put its cash cows up for sale – management agency KeyEast Co. and movie and drama production studio SM C&C Co. It dropped the online fan community operator DearU Co. from the sale list.

-- The same day, SM co-CEO Lee Sung-soo, a nephew of Lee’s deceased wife, created a YouTube channel and disclosed allegedly behind-the-scenes global business contracts between the entertainment giant and Lee’s Hong Kong-based private company.

-- Feb. 19: HYBE said it wouldn’t raise its offer price for SM above its bid price of 120,000 won.

-- Feb. 22: HYBE completed the 422.8 billion won share purchase of a 14.8% stake in SM from Lee.

-- Feb 23: HYBE threatened legal action to invalidate an undisclosed deal between Kakao and SM that hands over the rights to sell music albums and streaming services to Kakao Entertainment Co.

-- Feb. 27: Kakao said it would mobilize all possible countermeasures against HYBE’s attempt to increase ownership of SM through a tender offer. 

-- Feb. 28: HYBE failed in its tender offer to buy up to a 25% stake from minority shareholders.

-- March 3: The Seoul Eastern District Court accepted Founder Lee’s claim that SM does not need to raise fresh capital from Kakao and said the deal with Kakao could be seen as an attempt to undermine Lee's control of SM.

-- March 5: HYBE is understood to have tapped entertainment companies and financial institutions to raise up to 1 trillion won.

-- March 6: Kakao decided to launch a takeover bid for SM at 150,000 won, 25% above HYBE's bid price.

-- The same day, HYBE said it has raised its stake in SM by merely 0.98% in a tender offer.

-- March 8: SM's share price rallied to its record high of 161,200 won, as market speculation grew that HYBE might counter with a higher offer. 

-- March 10: HYBE Founder and Chairman Bang Si-hyuk was said to have met with chief executives and senior officials of its major institutional shareholders to gather support for its bid to take control of SM.

-- March 12: HYBE announced its withdrawal from the bid for SM after reaching an agreement with Kakao on the matter.

-- March 24: HYBE Co., the largest shareholder of SM Entertainment Co., said it has accepted Kakao Corp.’s tender offer to sell its shares in the K-pop pioneer for as much as $440 million, or about 25% more than its purchase price.

-- March 27: Kakao's takeover bid for SM attracted more than twice as many bids as expected.

-- March 31: SM is slated to hold an annual general shareholder meeting.

Yeonhee Kim edited this article.