이 기사는 2021년 06월 08일 07시57분 thebell에 표출된 기사입니다

HYBE, the South Korean company behind global star BTS, is set to split off its music label business despite opposition from the country’s state pension fund, after the proposal was passed on the back of shareholders friendly to the company’s founder and chief executive Bang Si-hyuk.

National Pension Service (NPS), which holds a 5.1% stake in HYBE, revealed that it voted against the company’s proposal at the special shareholders meeting held on May 14, citing concerns about possible damage to shareholder value given that the music label business is a key division for the company.

Despite the pension fund's opposition, the split-off proposal was passed with sufficient support. Typically, a business separation requires support from people holding more than one-third of the issued shares and at least two-thirds of shareholders in attendance.

HYBE is 34.8% owned by Bang Si-hyuk and the company’s other senior executives, followed by gaming company Netmarble (19.9%), private equity firm STIC Investments (8%), NPS (5.1%) and HYBE’s employee stock ownership plan (3.4%).

Netmarble – led by Bang Jun-hyuk, who is Bang Si-hyuk’s cousin – is considered as a friendly shareholder to HYBE. STIC Investments and the employee stock ownership plan have likely voted in favor of the company. Positive recommendations from global proxy advisory firms ISS and Glass Lewis also have probably helped to make more shareholders vote for the proposal.

The special shareholders meeting came after HYBE's announcement on April 1 that it planned to separate its label music division to set up a wholly-owned subsidiary, tentatively called Big Hit Music.

The proposal faced opposition from minority shareholders who raised concerns about damage to shareholder value in case the division – whose revenue last year accounted for 40% of HYBE’s 769.3 billion won ($691.5 million) in total revenue – goes public separately in the future. They instead requested the division’s spin-off, in which shares in a new company are distributed proportionately to existing shareholders.

LG Chem, which split off its battery business as LG Energy Solution last year to take it public, had also faced strong opposition from minority shareholders. HYBE, however, has made it clear that it had no plan to take Big Hit Music public, saying that the split-off was aimed at “enhancing operational efficiency.”

HYBE’s stock has trended higher since the special shareholders meeting with some turbulence. (Reporting by Choong-hee Won)