Kakao has officially denied the rumors of selling SM Entertainment.

Following rumors of Kakao Entertainment looking to sell SME, Kakao has officially declared the rumors are not true. The speculation about Kakao's sale of SM Entertainment began at the end of last year, which was fueled by controversy over stock price manipulation during Kakao's acquisition of SM Entertainment that led to the arrest of chief investment officer Bae Jae Hyun.

Kakao is also currently conducting an audit of SM Entertainment's financial statements and executives following the demands of the company's Board Audit Committee. Kakao has further requested documentation regarding the investments made by SME, which were carried out without the prior consultation with the parent company.

However, Kakao has continued to deny rumors about the sale of SM Entertainment, and they further stated no decision was made about the possible dismissal of SM Entertainment's management team as the audit results are not yet released.

Stay tuned for updates.