Big Hit Entertainment, the company behind South Korean superstar group BTS, is planning an initial public offering (IPO) on South Korea's KOSPI stock exchange, aiming to raise between US$630.3 million and US$810.4 million.
The move follows BTS' recent success, with the group's latest single, "Dynamite," topping the Billboard Hot 100 chart. Big Hit's IPO is set to be the largest in South Korea in three years.
The company's half-year profits reached KRW 49.7 billion as online concerts and merchandise sales compensated for event cancellations caused by the COVID-19 pandemic.
Big Hit's profits surpassed those of significant entertainment companies SM Entertainment, YG Entertainment, and JYP Entertainment, which together earned KRW 38 billion.
Big Hit and BTS have played a significant role in popularizing K-pop worldwide and have contributed to the growing presence of Korean entertainment in international markets.
The members of BTS collectively hold 478,695 shares in Big Hit with an estimated total value of KRW 64.6 billion (US$54 million).
Unlike its competitors, Big Hit actively incorporates IT technology to create value. For example, the company developed Weverse, a community application for BTS fans, which led to Big Hit being named one of Fast Company's 50 Most Innovative Companies.
During the pandemic, BTS hosted paid online concerts through Weverse, attracting 756,000 viewers and retaining revenue. The app accounted for 12.5% of the company's revenue.
Big Hit's founder and CEO, Bang Si-hyuk, is the largest shareholder with a 43.44% stake, while gaming company Netmarble holds a 25% stake.
NH Investment & Securities Co., Korea Investment & Securities Co., and JPMorgan Chase & Co. lead the offering.