If you haven’t heard of the insanely popular South Korean K-Pop band who go by the name of BTS, you must have been living under a rock. The K-Pop rose to success overnight, so much so that they are now expected to become multimillionaire shareholders after receiving shares in their label; Big Hit Entertainment as they are gearing up an initial public offering (IPO) that is expected to rise up to 926.6 billion ($811 million).
IT was just last week that the band scored Korea’s first-ever number one spot on the main US Billboard music chart with the enthusiastic disco hit Dynamite. This was their first all-English language single that hit the spot for mainstream US pop fans, with a YouTube video garnering more than 284 million views already.
The CEO of their record label, who is also its largest shareholder, Bang Si-hyuk gave 478,695 common shares to the seven BTS members which amounts to 68,385 per member last week. These shares were handed over “to strengthen long-term partnership with major artists and boost morale,” Big Hit said in a regulatory filing on Wednesday.
Each BTS band member would get 9.23 billion won of shares, or 64.6 billion won altogether, if the IPO is priced at the top of its range in October. The stock gift could be considered an attempt to bring the BTS members closer together and make them closer knit, said Kim Hyun-yong, analyst at eBEST Investment & Securities.
Big Hit relies heavily on BTS, with some 87.7% and 97.4% of its revenue in the first half of 2020 and 2019 respectively coming from the group, the filing said. South Korean men are obligated to join military service and the members of BTS will also be expected to do so. The label has hence worked to address market concerns that it needs to diversify its revenue streams. “There is the military issue but if there is no legal exemption, Big Hit is expected to either set up units with the remaining members or pursue solo acts while they serve in the military,” said Kim Hyun-yong.