User:ReVeluv02/sandbox/SM Entertainment USA

SM Entertainment USA is the American branch and subsidiary of the South Korean entertainment company SM Entertainment.

2008–2013: Establishment and American market entry
On August 29, 2008, SM Entertainment announced that it would add SM Entertainment USA as its subsidiary with Han Se-min as its chief executive officer (CEO) and a capital of one billion won. SM described the background of the establishment of SM USA as a local corporation to expand its business area in the United States (US) and lay the foundation for its artists to enter the US market. The addition of the subsidiary was also to promote further its artists' opportunities of penetrating the market. Consequently, BoA, TVXQ, and Super Junior had been prepared as a bridgehead for the record label's entry into the market. Therefore, it was highly probable that BoA, the most likely singer, would enter the market among SM artists and be the first to work with the company.

By September 2, it was reported that BoA would enter the US market the following year while being prepared in strict secrecy. BoA then held a press conference at the Imperial Palace Seoul on September 10 with the slogan "Best of Asia, Bring on America!" and disclosed the preparations and plans for entering the market in which she disclosed the preparations and plans for entering the market and released the song "Eat You Up" (2008) through an introductory video. An official from SM USA stated that as BoA penetrates the mainstream music of the US market, she would draw American music fans with her color, similar to what she did in Japan. The company also pushed for an agency project combining Hollywood and Asian entertainment businesses. BoA then signed a contract with Creative Artists Agency (CAA) through SM USA by May 6 through an announcement made in a press release by CAA.

Lee Soo-man cited "localization" as an essential factor in determining the success of overseas expansion with the philosophy of globalization that a company can succeed only by following the promotion and marketing methods that suit the country's cultural market. Lee added the expectation of having SM USA playing the role by taking advantage of the experiences with launching BoA and other artists in the US in the future. The company made a paid-in capital increase on 2011 and appeared to be expanding in size to operate as a business partner for a large record company in the US. On January 31, 2012, Girls' Generation was set to appear on the Late Show with David Letterman with Interscope Records, the group's American record label, and SM USA offered to appear on the show under a local marketing strategy after the release of The Boys.

On August 7, 2013, SM announced it would build a "boxed entertainment space" with the SM Town museum in Los Angeles. SM stated that it established it for local Americans to experience the Korean wave in Hollywood. SM then selected and purchased buildings on Sixth Street and Oxford Corner. The building purchase was made directly through SM USA and completed licensing procedures and escrow by selecting new concept Korean restaurants, entertainment spaces, and holograms. Additionally, SM noted The construction of the SM Town Museum and a complex entertainment space in Koreatown would be the first step toward opening a "new future" for the Korean wave.

Controversies
Following the general tax investigation of SM Entertainment in 2009, the National Tax Service established a "special" tax investigation into the company regarding offshore tax evasion. The tax organization launched the investigation after obtaining intelligence that SM had been evading offshore taxes by diverting some of its artists' profits from overseas performances to a paper company in Hong Kong. In April 2007, Lee Soo-man bought a villa on the coast of Los Angeles, jointly purchased with Polex Development in Hong Kong, with a purchase price of 4.8 million dollars, exceeding the personal overseas real estate investment limit of 3 million dollars. However, SM denied the allegations of Lee illegally taking his property abroad. SM Entertainment USA was involved in the situation as it was the firm concerned with having Lee sell his Malibu real estate to the company.