Some Artists To Become Big Shareholders In Big Merger Deal

In the merger between BTS’ label HYBE and Scooter Braun’s Ithaca Holdings, Braun’s SB Projects (SBP) roster of clients — among them Justin Bieber, Ariana Grande, J Balvin and Demi Lovato — are set to become significant shareholders in a capital increase meant to fortify the bond between both companies, according to Variety citing a Korean regulatory filing.

A total of 863,209 new shares were issued, at $186 a share, for a total value of $160.5 million. Of those shares, 462,380 were allocated to Braun himself, and 166,537 were allocated to Scott Borchetta, CEO of Big Machine Label Group, which Ithaca acquired in 2018. A commitment of $50 million from the purchase price was also divvied up to acts and employees who have been with Scooter Braun since he started SBP in 2007. 

Among them, Justin Bieber and Ariana Grande received 53,557 apiece — translating to roughly $10 million each — while J Balvin received 21,423 shares. Demi Lovato was allocated 5,355. Smaller slices of the pie were parceled out to other artists on the label’s roster, such as Carly Rae Jepsen and Asher Roth, who each received 535 shares, as well as producer Andrew Watt, Migos rapper Quavo, producer Tommy Brown, songwriter Jason “Poo Bear” Boyd and the members of Florida Georgia Line, among others.

The cash-and-stock mega-deal, a marriage of major entertainment labels, is believed to be valued at more than $1 billion. As part of the deal, Braun will become a member of the board of HYBE and Borchetta will continue on as CEO of Big Machine.

The agreement includes a range of services including management, label services and publishing for a roster of musical artists that, on the HYBE side, includes South Korean pop group BTS — one of the biggest global breakouts of the last five years. To that end, in combining the two companies, the wisdom is that their respective strengths on opposite ends of the globe will complement — and help — both partners.