Kakao M raises $169 million for investment in new contentKakao M raised 210 billion won ($169 million) from international investors and will be using the funds to develop original content.
The Kakao subsidiary owns multiple K-pop management companies, including Starship Entertainment, and runs production houses that create videos uploaded on YouTube and Kakao’s video platforms.
IU and Apink are among K-pop names managed by the company.
“The investment in Kakao M was decided based on the company’s capacity to create content across digital platforms, [TV and movie] screens, live performances and on its business structure which has potential to grow with original content,” Anchor Equity Partners was quoted as saying in Kakao’s statement on the transaction.
The Hong Kong-based private equity group is now Kakao M’s second-largest shareholder.
New music and videos will be funded by the money raised in the transactions.
With webtoons and web novels provided at Kakao’s portal site, the entertainment company has a lot of potential intellectual property (IP) to work with.
“We plan to accelerate the development of Kakao’s own IP to present them across mobile, TV and movie screens,” Kakao said in a statement.
It also plans to expand the K-pop business by distributing and marketing music, as well as hosting live performances or fan meetups.
As part of a drive to strengthen original content, the subsidiary acquired shares in multiple production houses last year, including movie producers Moonlight Film and Sanai Pictures.
This augmented the company’s portfolio, which spans music, videos, live performances and movies.
Kakao M was formerly Loen Entertainment - a manager of K-pop stars including IU and the operator of Korea’s largest music streaming service Melon.
It was acquired and made a business division of Kakao in 2016. Two years later, the music content and video creation units were spun off as Kakao M. The music streaming service was left to be managed directly by Kakao.
“The recent deal proves Kakao M’s potential and supports our aggressive acquisitions to expand business,” said Kim Sung-soo, Kakao M’s CEO. “It’s particularly encouraging that the decision was made before we made visible achievements.”
BY SONG KYOUNG-SON [firstname.lastname@example.org]
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