Align Partners Asset Management (hereinafter referred to as Align Partners) sent an open shareholder letter to SM Entertainment (hereinafter referred to as SM) on the 17th, requesting that executive producer Lee Su man disclose to all shareholders the plan to improve the contract with Like Planning, a private company. .
This is the second time Align Partners has sent an open shareholder letter to SM over the issue of the Like Planning contract, following March.
Like Planning is the private company of SM's largest shareholder, Lee Soo-man, general producer, and SM has signed a service contract with Like Planning and pays royalties every year. Align Partners is arguing that the service contract and royalties are an act that undermines shareholder value, and is demanding that the contract be terminated.
At the regular general shareholders' meeting of SM held on March 31st, the proposal for appointment of auditor Kwak Jun-ho, which was proposed by Align Partners as a shareholder, was also approved.
"SM paid 11.4 billion won, equivalent to 30% of its operating profit, as a commission to Like Planning in the first half of this year, and did not mention the contract issue with Like Planning." It is in a situation where both operating profit and market cap are falling behind compared to JYP Ent.
Align Partners officially requested that all shareholders be notified in writing of the plan to improve the contract problem with Like Planning by the 15th of next month and the progress so far. In the event of an emergency, he expressed his willingness to take legal action.
"If a reasonable and specific plan that is satisfactory to shareholders is not presented enough, we will implement various measures in stages, including exercising various legal rights as a shareholder," he said.
Reporter Ahn Ho-hyeon vicahh@infostock.co.kr
