SEOUL, May 27 (Reuters) - China's Tencent is expected to

become the second-largest shareholder of major K-Pop agency SM

Entertainment, according to a South Korean filing on

Tuesday.

South Korea's Hybe said in a regulatory filing

that it plans to sell its 2.2 million shares in SM Entertainment

to Tencent Music Entertainment ( TME ) for 243 billion won

($177 million) on May 30.

The 9.7% stake would make Tencent the second-largest

shareholder in SM Entertainment, after the 42% controlling stake

held by Kakao Corp and affiliate Kakao

Entertainment, according to an SM filing.

Tencent Music did not immediately reply to a request for

comment.

There have been signs of a potential thaw in the unofficial

ban on K-Pop concerts and performances in China, in place since

2016 after Beijing protested against the deployment of a U.S.

anti-missile defence system in South Korea.

Restarting K-Pop concerts in China would sharply increase

major agencies' ticket revenue, analysts said.

Hybe, a leading K-Pop agency behind supergroup BTS, acquired

the SM Entertainment stake in a failed takeover attempt in 2023.

Hybe said in its filing that it was selling the stake for

"efficient management of investment assets".