LG Electronics may form fitness venture with SM Entertainment
LG Electronics may establish a joint venture with SM Entertainment to develop digitalized workout content and health-related shows.
"The two companies are in talks to set up a joint venture on healthcare content," said a spokesperson for the electronics company on Thursday.
Local media outlets have reported that the two have established a joint venture with a registered address in SM Entertainment's headquarters in Seongsu-dong, eastern Seoul.
The venture will make its products available in the first half of the year, according to the reports.
The reports said the venture, tentatively named Fitness Candy, is capitalized at 10 billion won and that each company will own half the shares, although the spokesperson declined to confirm the details.
"The details are not yet decided," he said.
The new unit will be headed by Shim Woo-taek, CEO of Galaxia SM, a sports marketing company. Shares in the Kospi-listed company were up 8 percent on Thursday.
SM Entertainment rose by 0.65 percent to close at 76,900 won, while LG Electronics edged down by 0.79 percent to 126,000 won.
Healthcare-related digital content has been in great demand as the pandemic fueled the growth of home fitness. The home fitness content market is expected to grow 733 percent to 25 trillion won by 2026 from 3 trillion won in 2018, according to market tracker Global Research View.
Health care sector was among the new business areas picked by LG Electronics as a future growth engine. It added healthcare devices last month to business objectives in its corporate charter, heralding an expansion into fresh fields beyond home appliances.
SM Entertainment has focused on seeking new business opportunities related to high technologies, like the metaverse and non-fungible token (NFTs). The entertainment company acquired a 2.4 percent stake in FuturePlay, start-up accelerating company, last month.
FuturePlay nurtured multiple local start-ups specializing in healthcare, including MedInTech and Cellico.
BY PARK EUN-JEE [firstname.lastname@example.org]