SM Culture & Contents Co., Ltd. (KOSE:A048550) entered into a merger agreement to acquire AM Ent Co., Ltd. from Jang, Dong-Gun for KRW 5.6 billion on September 19, 2012. As per the terms of the merger agreement, SM Culture & Contents will issue 62.2068656 shares for every one share of AM Ent Co., Ltd., as a result, SM Culture & Contents Co will issue in total of 1.24 million shares to Jang, Dong-Gun for a lock-up period of one year. On completion of the acquisition, SM Culture & Contents Co., Ltd. will merge with AM Ent Co., Ltd., and SM Culture & Contents Co., Ltd. will be the surviving company while AM Ent Co., Ltd. will be dissolved company.

AM Ent Co., Ltd. reported KRW 2.44 billion of total assets, KRW 1.18 billion of total common equity, KRW 11.93 billion of revenue, KRW 536.19 million of EBIT and KRW 470.54 million of net income for the year ended December 31, 2011. At the completion of the merger, there won't be any changes in the management in the management structure, and the company will be the surviving company after the merger. In case that the shareholders who hold more than 20% of the total number of issued shares in the surviving company files for the objection to the merger in document form within 2 weeks from the notification of the merger pursuant to the commercial law 527 section 3-4, the small scale merger will be cancelled. In case that SM Culture & Contents Co., Ltd. and AM Ent Co., Ltd. fails to win the approval need for the merger from the related authorities and the approval from the merger, the contract will be cancelled.

The general meeting of stockholders for the merger approval shall be held on October 19, 2012. The deal is resolved by the Board of SM Culture & Contents Co., Ltd. and AM Ent Co., Ltd. on September 19, 2012. The general meeting of shareholders for merger approval of SM Culture & Contents Co., Ltd. is replaced as resolution of board of directors and the general meeting of shareholders for merger closing report is replaced as on-line notification by resolution of board of directors. The deal is expected to close on November 22, 2012. Yeil Accounting Corporation acted as valuer for SM Culture & Contents Co., Ltd.

SM Culture & Contents Co., Ltd. (KOSE:A048550) completed the acquisition of AM Ent Co., Ltd. from Jang, Dong-Gun on November 22, 2012.