After months of speculations, YG Entertainment finally confirmed what various financial industry insiders had previously predicted!
Back in October of 2014, LVMH Moët Hennessy – Louis Vuitton SE (LVMH) invested 61 billion won (approximately $51.6 million) in the agency in redeemable convertible preference shares (RCPS).
At the time, they set two options for themselves in five years, either converting into common stock at 43,574 won (approximately $36.83) per share, or demanding a repayment of 67 billion won (approximately $56.6 million) including annual interest as well.
This is terrible news for YG Entertainment because their stock price took a huge hit since 2019 began due to various scandals that hit both their artists and the founder of the agency.
YG Entertainment was never able to recover from these hits, the stock price took a toll and it’s priced at 23,550 won as of October 10 which meant that LVMH chose the latter option.
In a statement to the press, YG Entertainment officially announced that the company will be returning 64.7 billion won (approximately $54.1 million) to LVMH.
What are your thoughts on this?