South Korea’s top web service provider Naver Corp. pledged around 100 billion won ($88.4 million) in capital investment and partnership with YG Entertainment Inc. that manages top entertainers and idol groups like Psy and Big Bang.
According to the investment banking industry Friday, YG Entertainment, capitalized at 470 billion won, will issue new shares tantamount to a 10 percent stake to Naver for 50 billion won. The equity deal would make Naver the second largest stakeholder in YG Entertainment after its founder and chief executive Yang Hyun-suk who owns 19.07 percent.
Naver will also create a private equity fund with YG Entertainment by injecting another 50 billion won. The fund budgeted at 60 billion won will invest in lifestyle companies in food & beverage, fashion, cosmetics and entertainment sector.
The YG deal would be Naver’s first equity investment and joint venture with a listed company. Naver hopes to use its access to YG contents to draw fans from home and abroad to its web and mobile services.
Shares of YG Entertainment finished at 29,000 won Friday, up 3.20 percent from the previous session in Seoul trading.
By Kang Doo-soon and Song Gwang-sup
[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]