“Mutual cooperation throughout the entire process of the tender offer and acquisition of management rights”
Lee Soo-man, former executive producer of SM Entertainment, is giving a keynote speech at the Korean-Mongolian businessmen’s dinner held at the Grand Hyatt Hotel in Yongsan-gu, Seoul on the 14th of last month. 2023.2.14 News 1
It has been confirmed that Lee Soo-man, former executive producer of SM Entertainment (hereinafter referred to as SM), filed an injunction against the current management of SM against Kakao’s acquisition of new shares, in response to Hive’s request.
According to the stock purchase and sale contract between Hive and former general manager Lee, which Dong-A Ilbo obtained on the 1st, there is a provision that ‘the seller (former general manager) must apply for a provisional disposition in this case and must make every effort to obtain a quotation from the court’. It is included. On the 8th of last month, Lee filed an injunction with the court, and the stock purchase and sale contract with Hive was signed on the 9th, the next day.
Former general manager Lee said, “I applied for a provisional injunction because the issuance of new shares due to a paid-in capital increase by a third party would cause disadvantages to his position as the largest shareholder.” As the obligatory clause in the stock purchase agreement was confirmed, it is interpreted that Hive used the provisional injunction system to succeed in hostile mergers and acquisitions (M&A). Regarding the contract clause, a person in the legal profession said, “The subject of this provisional injunction application is actually Hive, not the former general manager.” It is what I want to do,” he explained.
The stock purchase agreement also includes a clause requiring Hive to actively cooperate with former general manager Lee in external messages and publicity. According to the contract, ‘Lee will cooperate with the announcement of external messages so that the tender offer process can be completed successfully’ ‘In the process of Hive acquiring the management rights of SM, we will provide the best cooperation such as announcements and publicity of external messages. ‘, etc. are included. An entertainment industry insider said, “Hive has taken the form of keeping a distance from former general manager Lee, but looking at the terms of this contract itself, Hive and former general manager Lee cooperated very closely throughout the entire process of applying for injunction, tender offer, and acquiring management rights.” It was evaluated.
Former general manager Lee’s side is in a position to request an injunction application before the 6th of this month, when Kakao pays for the issuance of new SM shares. Accordingly, the court is expected to decide whether to issue a provisional disposition on the 2nd or 3rd at the earliest. Previously, former general manager Lee filed an injunction with the court, claiming that SM’s decision to issue new stocks worth 111.9 billion won and convertible bonds worth 105.2 billion won to Kakao through a third-party allotment method was an act to secure management rights.
Reporter Park Min-woo [email protected]
