Earlier this year, news that SM Entertainment's founder and head producer Lee Soo Man had put up all 18.7% of his shares in the entertainment agency caused a buzz among industry insiders.
Being the largest shareholder in SM Entertainment, Lee Soo Man's move to put up the entirety of his shares on the market signaled that the buyer would effectively acquire SM Entertainment. Early on during the acquisition offer, various corporations such as Kakao Entertainment and CJ ENM held talks with SME to negotiate the purchase. However, it was reportedly recently that Kakao Entertainment has withdrawn from the acquisition negotiations, due to the extreme preconditions put forward by SM Entertainment.
According to insider reports on October 28, SM Entertainment's preconditions for handing over the 18.7% of Lee Soo Man's shares included that: Lee Soo Man would be guaranteed a key executive position within the buyer company, and that Lee Soo Man would be guaranteed a salary of 10 billion KRW (~ $8.5 million USD). These insiders claimed that SM Entertainment was adding on more implausible preconditions as the negotiations went on, strategically leading the negotiations in its favor as more buyers showed interest.
With Kakao Entertainment's withdrawal from the acquisition offer, CJ ENM is currently the only potential buyer still involved in negotiations.