South Korea‘s SM Entertainment and China‘s Tencent Music Entertainment Group (TME) have established a joint venture in Beijing named STE.
The venture will develop and manage artists for the Greater China market and is preparing a new Chinese idol group for a debut within two to three years.
SM Entertainment is home to acts including aespa, NCT, Super Junior, EXO, Girls’ Generation, Red Velvet, and Riize. TME operates China’s largest music streaming services:
- QQ Music
- Kugou Music
- Kuwo Music
- WeSing
SM announced the venture on Thursday (August 27). It follows a memorandum of understanding signed by SM and TME in May 2025, under which the two companies agreed to set up a cooperation system.
Leadership and artist management#
Zhoumi, who has performed for nearly 20 years as a member of Super Junior‘s China-based unit Super Junior-M, has been appointed CEO of the joint venture.
SM said Zhoumi pairs an understanding of the K-pop production system with management experience built up as a Director at the company’s Chinese subsidiary.
STE will run auditions to cast the new group and will handle its management inside China once it has debuted, according to SM.
The venture will also take over Greater China management for three SM artists: NCT DREAM‘s Renjun, plus WayV‘s Yangyang and Xiaojun. SM said STE will handle that work exclusively, providing “more sophisticated localized promotions” and support for the artists’ entertainment activities.
Zhoumi said:
“I am delighted to serve as the representative of this joint venture, which was born from the solid trust and strategic vision between SM and TME. I will perfectly combine SM’s unrivaled strengths in IP and content production with the unique characteristics of the Greater China market to showcase differentiated content and generate meaningful results as a bridge between the two companies.”
Investment context and market position#
TME became SM’s second-largest shareholder in May 2025, when it acquired HYBE‘s entire 9.38% stake in the K-pop company for 243.35 billion South Korean won ($177m at the exchange rate at the time).
Kakao and subsidiary Kakao Entertainment together hold a 40.28% stake in SM, making the South Korean tech group its largest shareholder.
STE arrives after a run of TME investments in South Korean music companies. In February, TME entered a joint venture with JYP CHINA and CJ ENM called ONECEAD, also focused on artist development and management in Greater China. In May, TME co-led an $80 million Series B round in The Black Label, the studio behind key tracks on the KPop Demon Hunters soundtrack, in a deal that valued the company at approximately $660 million.
SM’s China work sits inside a localized IP strategy that Co-CEO Dmitry YJ Tak outlined in January, alongside the company’s “SM NEXT 3.0” plan.
“In China, we are working with Tencent Music Entertainment; in Thailand, with True; and in Japan, we are currently in discussions with multiple partners,” said Tak. “Our focus is on creating locally resonant IP while maintaining SM’s creative identity.”
K-pop acts have reportedly been unofficially barred from performing in China since around 2016/2017, after South Korea deployed a United States missile defense system.
China overtook Germany to become the world’s fourth-largest recorded music market in 2025, growing 20.1% year over year. South Korea ranked seventh in the same market ranking.
