South Korean content distribution company JTBC Studios has started a fundraising process with eight investors likely to compete.

JTBC Studios has hired Morgan Stanley to lead the sale process to receive funding from outside, according to sources on June 15. JTBC Studios has reportedly sent investment proposals to eight potential investors, including strategic investors and financial investors. It plans to hold a preliminary bidding after the release of its earnings results in August. JTBC Studios aims to complete the process around the end of the year.

“I heard that the sale manager Morgan Stanley has sent investment proposals to about eight investors,” said an industry source.

Established in 1999, JTBC Studios is a content arm of South Korean broadcasting company JTBC. Its distribution business, which accounts for half of the company’s sales, has recorded an operating margin of 15 to 20 percent.

JTBC Studios’ production business is also growing rapidly. The company has produced many popular in-house TV drama series, including ‘Sky Castle’ and ‘Something in the Rain’. Sales of the TV drama production business rose to 47.6 billion won ($39.1 million) in 2019 from 6.7 billion won in 2015, a sevenfold increase in four years.

The trend is likely to continue this year. The company’s in-house TV series ‘Itaewon Class’ and ‘The World of the Married,’ which were aired in the first half of this year, also saw solid success. JTBC Studios’ sales are likely to hit record highs at the end of this year.

The company’s earnings before interest, taxes, depreciation and amortization (EBITDA) stands at 20 billion won thanks to its rapid growth. JTBC Studios is carrying out the latest fundraising to make an additional investment despite its stable financial status. It has invested 60 billion won in production companies since last year and is in need of additional funds to launch an over the top service jointly with CJ ENM.

Market insiders are paying attention to the company’s valuation. By applying its peer company Studio Dragon’s EBITDA multiples of around 20 times, JTBC Studios’ enterprise value is estimated at approximately 400 billion won. The valuation is expected to increase as the company has produced multiple successive hit TV dramas in the first half of 2020 and more new TV dramas are scheduled for the second half. (Reporting by Se-hun Jo)