K Wave Media Accelerates Growth with First Acquisition Post-Listing, a Visual Effects and AI-powered Advertising Company, Adds World-Class Tech Companies as New Clients

Core Insights - K Wave Media's acquisition is projected to increase revenues by 25-30% over the next 12 months, enhancing its capabilities in VFX, AI-powered advertising, and 3D content production for global clients [1][2] - The acquisition marks K Wave Media's first strategic move since its NASDAQ listing, aimed at accelerating growth and expanding its creative portfolio [1][2] Financial Performance - Target company recorded $10.7 million in revenue for 2024, with a compound annual growth rate of 22% from 2020 to 2024 and EBIT ranging from 12-19% during the same period [2] - K Wave Media's revenue for 2024 was reported at $58 million [2] Strategic Vision & Growth Opportunities - The CEO of K Wave Media emphasized the acquisition's role in scaling the company into a leading content producer and digital asset manager, particularly in the Web3 content space [5] - The acquisition is expected to facilitate the development of a platform for tokenizing IP rights and transforming the fandom business [5] About the Companies - K Wave Media is a publicly listed entertainment company with a Bitcoin treasury, focused on creating, distributing, and monetizing high-quality content across various platforms [6] - Rabbit Walk, the target company, is a prominent visual effects and 3D content studio known for producing over 1,400 commercials and brand films, with a strong client base including major global brands [4][7] Deal Structure - K Wave Media will acquire a 55% stake in Rabbit Walk by issuing ₩9 billion KRW (approximately USD $6.5 million) in ordinary shares [8] - An additional ₩9 billion KRW (USD $6.5 million) in equity will be contingent upon Rabbit Walk achieving an operating profit exceeding ₩1.2 billion KRW (approximately USD $800,000) in either 2025 or 2026 [8]