Big Hit Entertainment IPO: BTS' Management Group Sees Stock Price Pop

South Korean entertainment firm Big Hit Entertainment, which managers K-Pop boy band BTS, saw its stock pop Monday to $115 per share ahead of its IPO on Oct. 15 at the Korea Exchange.

Its stock price came in at $115 (KRW 135,000), the top end of the $90 to $115 per share range announced earlier. The regulatory filing also reveals Big Hit is expected to raise $820 million through the offering.

The top-end price values the company founded in 2005 by songwriter Bang Si-hyuk (also called "Hitman" Bang) at $4.1 billion. This makes the deal South Korea's largest stock offering since July 2017, based on data from Dealogic.

Big Hit's stock is 1,117 times oversubscribed by institutional investors. Market analysts affirm the huge interest in Big Hit's IPO is being driven by retail investors and BTS' global legions of fans who call themselves the "ARMY."

The IPO price has made Bang a billionaire and the richest man in the country's entertainment industry, and millionaires out of each of the band's seven members. Bang owns 43% of Big Hit. Last month, Bang gave each of the BTS boys 68,385 shares, which are now worth $7.9 million at the issue price.

Big Hit began its IPO journey last May when it applied for a pre-IPO consultation with the Korea Exchange. The application is a requirement under South Korean law before a company can file paperwork for an IPO. During the same month, Big Hit filed for a preliminary review of its planned IPO.

BTS consists of Kim Tae-hyung (also known as V), Jung Ho-seok (J-Hope), Kim Nam-joon (RM), Kim Seok-jin (Jin), Park Ji-min, Jeon Jung-kook, and Min Yoon-gi (Suga).

BTS' global success has made Big Hit one of South Korea's leading entertainment empires. Big Hit revealed revenues of $500 million in 2019 and an $84 million operating profit. Whether the company can top these figures this year despite the tremendous hit taken by the entertainment industry from the COVID-19 pandemic is open to question.

What remains true, however, is the enduring success enjoyed by BTS among its mostly young female fan base worldwide. In 2019, BTS became only the third group in 50 years to have three No. 1 albums on the Billboard 200 charts in less than 12 months. Only The Beatles and The Monkees have achieved this feat.

In August, BTS became the first South Korean act to land at No. 1 on Billboard's main singles chart in the U.S.

"BTS achieves its first No. 1 on the Billboard Hot 100 songs chart, as 'Dynamite' debuts at the summit," Billboard announced on Aug. 31.

Previously, the highest-charting South Korean artist on the Hot 100 was PSY with his 2012 viral hit "Gangnam Style," which peaked at No. 2.

BTS in August won four awards at the MTV Video Music Awards (VMAs).

BTS has topped the Billboard 200, Billboard's main album chart, four times since May 2018. Its chart toppers were "Love Yourself: Tear; "Love Yourself: Answer;" "Map of the Soul: Persona" and "Map of the Soul: 7."