SM Teams Up with Tencent, Its Second-Largest Shareholder, to Launch Idol Group in China

MOU Signed with Affiliate Tencent Music... Establishing a Cooperative Framework
SM to Produce Local Idol Group in China... Tencent to Handle Music Distribution

SM Entertainment (SM) is joining forces with Tencent, which has become its second-largest shareholder. The two companies plan to collaborate extensively, including launching a local idol group in China.

On May 29, SM announced that it had signed a memorandum of understanding (MOU) with Tencent Music Entertainment Group (TME) to establish a cooperative framework.

Yonhap News

This collaboration will include co-producing a new idol group targeting the Asian market, intellectual property (IP) business, and local concerts. Previously, the two companies had only worked together in music distribution.

This partnership was formalized after Tencent Music, a Tencent affiliate, acquired the SM shares previously held by HYBE. On May 27, HYBE disclosed that it had sold approximately 2.21 million common shares of SM to Tencent Music through a block deal at 110,000 won per share. The total sale amount is estimated at about 243 billion won. As a result, HYBE has now fully divested its stake in SM.

The collaboration includes plans for the two companies to debut a local idol group in China within the next two to three years. SM will handle all aspects of production, including casting, training, and producing, while TME will be responsible for local promotion, as well as album and music distribution.

In the IP business, the two companies will jointly develop physical and digital photocards, character merchandise, pop-up stores, and video content within China. In the concert sector, they will strengthen cooperation on artist tours, including the SM Town Live concert scheduled to be held in Hong Kong in 2026.

An SM representative stated, "This strategic partnership, which combines the strengths of both companies, marks an important turning point for expanding SM's global influence and solidifying its presence in the Chinese market." The representative added, "We expect this to further strengthen our position in the global market while creating new business models."

This content was produced with the assistance of AI translation services.