One of South Korea’s largest companies, SM Entertainment, is reportedly looking to terminate their exclusive contract with former CEO and founder Lee Soo Man. Check out the following complete reports for what happened between Lee Soo Man and SM Entertainment.
SM Entertainment is for Early Contract Termination with Lee Soo Man Company, Like Planning
On September 15, Korean media reported that SM Entertainment was currently considering terminating its contract with Lee Soo Man. However, according to the report, the company is still weighing on the impact of the key stakeholders regarding this termination.
“We are considering whether to terminate the production contract with Producer Lee Soo Man’s private company ‘Like Planning’ early.”SM Entertainment.
What REALLY Happened?
According to the media report, the contract termination plan has been on the table for a while. In fact, reports mentioned that it was the former CEO who wanted to terminate his contract in the first place.
Lee Soo Man had requested that the company end its exclusive contract by the end of this year. Therefore, SM Entertainment is currently working on all the possible impacts regarding the contract termination to the company and its future.
“Music executive Lee Soo Man has expressed to SM that he wants to terminate the contract early by the end of this year.
We plan to discuss in depth with key stakeholders the impact of early termination of the production contract, how it will affect our business, and to summarize our position on the future direction and announce it later.”SM Entertainment.
Lee Soo Man was the founder of SM Entertainment and a member of the board of directors until 2010. Then, following various issues, he decided to step down as CEO. However, he was still involved in the management and as a music producer. Not to mention being the company’s largest shareholder until he decided to sell his shares.
At the same time, Like Planning is a personal company he founded, where SM Entertainment outsourced numerous of their music production.
Alleged Reasons About What Happened Between SM Entertainment and Lee Soo Man
Following the contract termination, various rumors and alleged reasons began circulating on the internet and social media.
One of the alleged issues was the fact that the company paid excessive royalties to Like Planning.
This issue was specifically pointed out by Align Partners Asset Management, which owns 1.1% shares of SM Entertainment.
Align Partners Asset Management mentioned that SM Entertainment had paid 142.7 billion KRW (approximately 102 million USD) in royalties to Like Company. It has happened since the company’s listing on the stock market to last year’s third quarter.
On the other hand, Korean media also interpreted this excessive payment of royalties as prevention of more pressure and opposition from shareholders, including Align Partners Asset Management itself.
As of today, there has been no official statement from Lee Soo Man’s side regarding this contract termination plan.
At last, what do you think about what happened between SM Entertainment and Lee Soo Man? Feel free to share your thoughts in the comments. Also, stay with Kpoppost Instagram, Facebook, Twitter, and Telegram channel for more updates.
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