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Posted by EunhaYi Wednesday, November 22, 2023

Prosecutors take action in Kakao stock manipulation investigation

AKP STAFF

The investigation into allegations of stock manipulation surrounding Kakao Corporation and its acquisition of SM Entertainment has intensified. Prosecutors have conducted a mandatory search at Kakao's Pangyo office, seeking evidence related to the case.

Earlier, the Financial Supervisory Service (FSS) had recommended the indictment of several key figures in the case, including Kakao founder Kim Beom Su, Kakao CEO Hong Eun Taek, Kakao Entertainment co-CEOs Lee Jin Soo and Kim Sung Soo, as well as lawyers who provided legal counsel.

The investigation centers around suspicions of inflating the share prices of SM Entertainment, a major K-pop management firm, in an attempt to thwart a takeover bid earlier this year by HYBE, the parent company of BTS' management agency, BigHit.

It is alleged that Kakao collaborated with a private equity fund operator to inject approximately 240 billion won (about 185 million U.S. dollars) into the market, surpassing the 120,000 won per share offered by HYBE to small shareholders. Ultimately, HYBE halted the bid, allowing Kakao and its subsidiary to jointly secure nearly a 40% stake in SM, thus gaining management control.

Additionally, Kakao is facing accusations of failing to fulfill the compulsory declaration regarding their stock acquisition.

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forgivemenot1
forgivemenot12,990 pts Wednesday, November 22, 2023 2
Wednesday, November 22, 2023

Other than the usual fines which I’m sure will be small and probably no jail time for anyone involved, Kakao should be forced to sell all it’s shares in SM Entertainment and be, as well as its subsidiaries, banned from reacquiring them in the future.

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The-Monkey
The-Monkey2,339 pts Wednesday, November 22, 2023 0
Wednesday, November 22, 2023

oh look kakao is in trouble again. just another normal day, i suppose.
and gee....i wonder who the private equity fund operator is. probably not the same one that is has been for years now.

is kim beom su just going to apologise for abuse of market dominance/monopoly again and then continue on?

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