Why might K-pop’s SM Entertainment sever ties with founder and chief producer Lee Soo-man?
- Lee, who founded SM Entertainment in 1995, has been integral to the forming of modern K-pop, producing acts including Girls’ Generation, Exo and Aespa
- Shares in SM Entertainment jumped after it announced plans to terminate its multimillion contract with Like Planning, a music production company owned by Lee
SM Entertainment announced on September 16 that it may sever official ties with its chief producer Lee Soo-man.
SM Entertainment plans to terminate its contract with Like Planning, a music production company owned by Lee.
SM Entertainment has spent the past few years being questioned by investors on its 20-year commitment with Like Planning and the millions of dollars – around 6 per cent of SM’s annual revenue – that are paid annually to Lee.
Following the announcement of the planned shift, shares in the company jumped an equivalent of nearly US$10, before dropping slightly, as investors aimed to be part of the company’s new shape.
The contract between SM Entertainment and Like Planning is set to expire in December 2023, with an option to renew if SM decides its connection with Lee cannot be severed.
Despite Lee’s role in the success of SM Entertainment and K-pop, many investors and fans see a shift away from his influence and Like Planning as part of a new era for SM Entertainment, which was the top-ranked South Korean music company for years.
In related news, also on September 16, SM Entertainment boy band NCT 127 released their fourth Korean-language LP, 2 Baddies.