In the merger between BTS’s label HYBE and Scooter Braun’s Ithaca Holdings, the list of customers of Braun’s SB Projects (SBP), including Justin Bieber, Ariana Grande, J Balvin and Demi Lovato, will become significant shareholders in a capital increase intended is to strengthen the bond between the two companies, according to a Korean regulatory dossier.
A total of 863,209 new shares were issued at $ 186 per share for a total value of $ 160.5 million. Of these shares, 462,380 were allocated to Braun itself, and 166,537 were allocated to Scott Borchetta, CEO of Big Machine Label Group, which acquired Ithaca in 2018. A $ 50 million commitment from the purchase price has also been shared with tradesmen and employees who have been with Scooter Braun since he started SBP in 2007. Among them, Justin Bieber and Ariana Grande received 53,557 shares – meaning about $ 10 million each – while J Balvin received 21,423 shares. Demi Lovato awarded 5,355. Smaller slices of the pie were handed out to other artists on the label’s list, such as Carly Rae Jepsen and Asher Roth, who each received 535 shares, as well as producer Andrew Watt, Migos rapper Quavo, producer Tommy Brown, songwriter Jason “Poo Bear ”Boyd and the members of, among others, Florida Georgia Line.
Braun’s business partner and SBP president Allison Kaye, meanwhile, received a solid 26,778 shares – good for $ 5 million – and SBP general manager Jen McDaniels received 10,711 shares. Other longtime staff members have also received various interests, including Scott Manson, James Shin, Jules Ferree and Shauna Nep.
Scooter Braun, the largest shareholder in Ithaca Holdings, LLC, and Scott Borchetta, the largest shareholder, share 25% of the trading proceeds received, while great artists and managers and employees (39) such as Justin Bieber and Ariana Grande receive their bonus . Shares, ”reads a separate submission related to the transaction. “We plan to participate in the paid-in capital increase granted to HYBE for 100% of HYBEs (one year’s protection deposit), and we expect to be more active as a shareholder in the future.”
The cash-and-share mega-deal, a marriage of great entertainment labels, is thought to be valued at more than $ 1 billion. As part of the agreement, Braun will become a member of the board of HYBE and Borchetta will continue as CEO of Big Machine.
The deal includes a range of services, including management, label services and publication for a list of musical artists that includes the South Korean pop group BTS on the HYBE side – one of the biggest global eruptions of the past five years. Combining the two companies is the wisdom that their respective strengths on the other side of the world will complement and help both partners.
Sources familiar with the deal note that Braun, although he was reportedly in talks with former senior Disney executives Tom Staggs and Kevin Mayer, who is raising money for their own SPAC, preferred to link up with a growing firm which is in many the same. businesses as Braun. The partnership with a company like HYBE, which has similar music, talent and content businesses, offers Braun’s various entities operational and strategic benefits on a global stage.
As part of the $ 1 billion deal, HYBE technically had to acquire Ithaca and in the process buy the minority stake of private equity giant Carlyle Group in Ithaca.
HYBE, formerly Big Hit Entertainment, was launched in October 2020 with a $ 820 million offer that was the largest in South Korea in three years. Despite the initial hype, the stock has risen dramatically since then. After a boom in the trading debut, equities sank through the last months of 2020 before holding a spectacular march from the end of January 2021, reaching a new high of 52% above the IPO price in mid-February – ‘ a market capitalization of $ 6.4 billion.
South Korea was also the fastest-growing major music market in 2020, up 44.8% year-on-year, according to an IFPI report in March. Although the country remains in 6th place in the Top 10 market for global markets, it will definitely break into the top 5 soon if the rate continues.
According to IFPI, BTS had 2020’s biggest album with ‘Map of the Soul: 7’. Since the release of February 2020, he has achieved the leading awards in the group’s home country, where the album achieved South Korea’s all-time sales record, as well as the world’s five largest music markets (USA, Japan, UK, Germany, France) .
Pictured (from left): J Balvin, Ariana Grande, Justin Bieber