According to Yonhap News,

(SEOUL=Yonhap News) YG Entertainment Corp., South Korea's high-brand entertainment agency who has Psy as its client, said Wednesday it will sell new shares worth 61 billion won (US$69.7 million) to the investment fund arm of French luxury group LVMH, a move seen as paving the way for expanding its fashion business globally.

YG Entertainment said it will issue 1.35 million convertible preferred shares, which are priced at 44,900 won, through a third-party allotment with L Capital Asia, the Asian trading arm of LVMH. The preferred stocks can be converted into common stocks a year later.

"(The stake sale) is aimed at long-term development and entry into new business," the company said in a regulatory filing without giving further details.

"YG Entertainment has already launched a joint venture with Cheil Industries for a new clothing brand, but joining hands with the French luxury group will certainly upgrade it's global brand image, which is a boost to the company in the long term," said Kim Chang-kwon, an entertainment analyst at KDB Daewoo Securities Co.

Its shares closed at 46,000 won at the secondary-KOSDAQ market on Wednesday, up 3.14 percent from the previous session. The new share announcement was made after the market closed.

ejkim@yna.co.kr

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Source: Yonhap News (August. 13, 2014)