entertainment

Investors swamp IPO for K-Pop band BTS management label

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By Joyce Lee

Big Hit Entertainment, the management label of hugely popular South Korean K-Pop group BTS, priced its initial public offering (IPO) at the top of its range on Monday, as hopeful buyers chased South Korea's largest listing in three years.

Institutional investors sought more than 1,000 times the number of shares on offer, with Big Hit riding on the success of the seven-member band, which has become the first South Korean group to reach No.1 on the U.S. Billboard Hot 100 singles chart with song "Dynamite".

Big Hit priced the IPO at 135,000 won ($115) per share, it said in a regulatory filing, the top of an indicative price range of 105,000-135,000 won announced earlier this month.

Some 1,420 institutional investors indicated interest for shares in the offering, looking for 1,117 times the number available, the filing said. About 98% said they would pay the top-range price or more.

Institutional and retail investors' subscriptions are due on Oct 5-6.

The IPO will raise 962.6 billion won ($820 million) through the offer of 7.13 million new shares. It is the biggest South Korean IPO since Celltrion Healthcare raised 1 trillion won in 2017.

The pricing values Big Hit at about 4.8 trillion won, taking into account common shares plus redeemable preferred shares that will be converted into common shares upon the IPO.

With plenty of liquidity in the market, some analysts predict gross bids from retail investors could hit 100 trillion won ($85 billion), making it South Korea's hottest initial public offering.

The central bank is watching the offer closely as a massive oversubscription for shares could send ripples through short-term money markets.

Big Hit is expected to list on the KOSPI in October.

© Thomson Reuters 2020.

©2020 GPlusMedia Inc.

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