Louis Vuitton is getting into the K-Pop business. The world’s largest luxury brand’s private equity arm, LVMH, announced Wednesday it will invest up to $80 million in South Korea’s YG Entertainment Inc., the record label and talent agency behind some of the genre’s largest acts.
Among others, YG Entertainment represents K-pop hit-makers PSY, Big Bang, 2NE1, Epik High, Lee Hi and Akdong Musician, as well as a roster of Korean actors, boasting a market value of $690 million as of Wednesday’s closing. With the two companies currently discussing opportunities for strategic partnership, as Reuters reports, this new investment stands to accelerate YG’s expansion into the fashion business.
Previously YG announced it would be teaming up with Samsung Group’s textile and fashion affiliate, Cheil Industries, on an apparel line called NONA9ON (pronounced ‘nonagon’) that’s set to launch Sept. 9. It was also announced last year the company would enter the cosmetics business, establishing a firm with Chinese makeup company Huanya Group in a joint venture through the South Korean company Coson Co Ltd.
LVMH’s private equity branch L. Capital Asia will invest 61 billion won ($60 million) in 1.35 million convertible preferred shares, priced at KRW 44,900. And, according to a YG report, the entities are in negotiations to acquire another $20 million of shares from YG founder and largest shareholder, former K-pop star Yang Hyun-suk. If that deal goes through, it will be YG’s second-largest shareholder.
YG and LVMH has worked together previously on the YG-managed rapper-producer G-Dragon‘s debut solo album in 2009 when Louis Vuitton signed on as the clothing sponsor to the project.