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Troubled Bugs Music seeking ties with CJ

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Below is the excerpted article from the Korea Herald.

 

Troubled Bugs Music seeking ties with CJ .

 

Bugs Music, Korea's largest online music site, announced yesterday it is in the middle of forging a business partnership with CJ Entertainment Co., a subsidiary of leading conglomerate, CJ Group, by selling a one-fifth stake in the company.

 

According to the online music provider (bugs.co.kr), the agreement involves CJ Entertainment investing 20 billion won to acquire a 20 percent stake in Bugs Music.

Bugs CEO Park Sung-hun said the entertainment giant would buy new shares issued by his company.

"Even after the investment, we will continue to be the primary shareholder and maintain managerial rights, but should we put our stakes up for sale some time after the year 2006, CJ would have priority buying rights," said Park, quoted by Yonhap News Agency.

He said the agreement could be finalized within one to two weeks.

As of the end of last year, CJ Entertainment, a film and distribution company, accounted for 20.6 percent of the domestic distribution market ranking No. 1.

The entertainment giant began tapping online companies in April in attempts to strengthen its realm of on and offline services.