Profile Behind A2O Lite's No. 1 on Melon: 74-Year-Old Lee Soo-man...How Did He Spend His Restricted 3 Years?

The debut song 'Neon' by girl group A2O Lite, created by Lee Soo-man, held the No. 1 spot on Melon's Top 100 as of the morning of October 21. The song reached the top 29 hours after its release on the evening of October 13, maintained the No. 1 position consecutively from October 15, and won its first music show trophy on music broadcast 'The Show' on October 20. The official YouTube music video has surpassed 19 million views. On stage stand nine performers averaging fifteen years old; behind the stage stands a seventy-four-year-old man.

This article is about the person behind the stage. The date Lee Soo-man returned after leaving SM Entertainment three years ago was determined by a single line in a contract. What he held in his hands upon return was determined by how he spent those three years.

Before Departure: Up to 6% of Revenue

Lee Soo-man stepped down as a registered director at SM in 2010. Subsequently, he received production fees through his personal business entity Like Planning. According to the contract, he received up to 6% of revenue, with 24 billion won paid in 2021 alone. While operating outside the company, he stood at the center of the company's cash flows.

In 2022, activist fund Align Partners targeted this structure, questioning whether it was appropriate to pay hundreds of billions of won annually to the largest shareholder's personal company. An auditor recommended by Align was appointed at the shareholders' meeting, and the Like Planning production contract ended that year. On February 3, 2023, SM management announced SM 3.0, signifying the 'end of Lee Soo-man's one-man system,' and four days later, it agreed to transfer new shares to Kakao. The founder was being pushed out of the company bearing his own name.

The Contract Line: 3 Years, Korea Only

Then HYBE arrived. On February 9, 2023, HYBE agreed to purchase Lee Soo-man's 14.8% stake in SM at 120,000 won per share, totaling 422.8 billion won. It was 21.8% more expensive than the previous day's closing price. The contract listed three items: stock purchase, a put option to repurchase remaining 3.65% shares at the same price, and a commitment to delegate voting rights at that year's shareholders' meeting to HYBE. Additionally, one clause that HYBE disclosed in a press release but was absent from filings stated: 'Lee Soo-man can only conduct production activities overseas, not domestically, for the next three years.'

This is a non-compete clause. The same principle applies when transferring a neighborhood store. The Commercial Act prevents the seller of a business from engaging in the same business in a certain area for up to 10 years automatically, or up to 20 years if contractually agreed, because the purchase price includes not only the storefront and fixtures but also the promise that 'the owner won't open another shop nearby.' The Lee Soo-man case involved selling stock rather than a business, so this regulation did not automatically apply. Thus, it was explicitly inserted into the contract. The period was three years; the scope was Korea.

This single line reads two ways for HYBE. One was to draw a line against Lee Soo-man's return to SM in the market. Align Partners and SM management's point of attack was precisely Lee Soo-man. On February 16, HYBE made a statement clarifying that 'the expiration of three years does not mean a return to SM.' The other purpose was to protect the value of the purchased stock—a mechanism to reduce the risk of him immediately launching a competing venture.

During the 3 Years: Walking Out Through Three Doors

However, that clause contained loopholes. Overseas production not targeting Korea as a primary market was possible. According to reports at the time, one-off events or international events allowed him to stand as a producer domestically. Albums produced overseas could be brought into Korea if he was not involved in distribution.

Lee Soo-man walked through those doors. In March 2023, he established the personal company Blooming Grace in Seoul. Entertainment was not listed in the registration purposes, and Lee Soo-man purchased a building in Apgujeong-dong for 15 billion won. In 2024, he established A2O Entertainment in Singapore and debuted a five-member girl group A2O May that December. He charted them on Chinese music charts and American radio charts. In 2025, he established a Korea subsidiary in Cheongdam-dong, Seoul, and starting from March, shortly after the non-compete restriction was lifted in late February of this year, he conducted auditions every Sunday. On October 12, at Kinex in Goyang, he simultaneously debuted nine members of a girl group and fifteen members of a boy group.

The eight months of preparation following the non-compete expiration through debut were not all. He had spent three years preparing the next stage overseas.

Final Account: What Was Lost and What Was Gained

What Lee Soo-man lost was the company bearing his name and the contract worth up to 6% of revenue. What he gained was cash and three years to prepare the next stage overseas.

Regarding cash: 422.8 billion won from the stock sale, plus 104.3 billion won from the put option exercised the following year for remaining stock at 120,000 won per share, totaled 527.1 billion won. On February 28, 2024, when the additional acquisition filing was announced, SM's closing price was 79,500 won. HYBE had to buy at approximately 51% more than that market price, a difference of 35.2 billion won. When Kakao launched a tender offer at 150,000 won per share, Lee Soo-man did not participate. The following year, he exercised the put option and transferred his remaining stake to HYBE.

The same three years were spent differently by the other two parties. HYBE invested 555.1 billion won in SM stock and resold it for 560.5 billion won. The difference in stock trading proceeds alone was 5.4 billion won. Kakao and Kakao Entertainment purchased approximately 8.33 million shares through a tender offer for 1.25 trillion won. Calculating this quantity at October 21's closing price of 85,900 won yields approximately 534.2 billion won lower than the purchase price. Kakao founder Kim Beom-soo was indicted on charges of market manipulation to interfere with HYBE's tender offer but was acquitted in first trial on October 1 of last year. The appellate decision is scheduled for November 20.

HYBE's 5.4 billion won does not reflect net profit after accounting for dividends, taxes, transaction costs, and borrowing interest. Business cooperation such as SM artists' Weverse entry remained as well. However, stock trading alone did not yield significant gains, and the time he restricted Lee Soo-man from domestic activities was three years. Kakao obtained SM, but the October 21 closing price fell short of both the 120,000 won at which HYBE bought and the 150,000 won Kakao had offered.

Remaining Questions

The Kinex debut showcase was his first official domestic stage since delivering a keynote speech at the International Society of Authors, Composers and Publishers World Congress in May 2024. One hit song does not guarantee the next will succeed, and where A2O goes is determined not by contract but by the market.

However, one thing is certain. A non-compete clause can restrict a person's domestic activities for three years, but it cannot restrict what that person prepares overseas. In the 'SM War' that HYBE and Kakao fought, Lee Soo-man walked away with both cash and the next stage.