SEOUL, South Korea — South Korean prosecutors stated Tuesday they’ve arrested the founding father of expertise big Kakao Corp. for alleged inventory value rigging throughout his firm’s takeover of a significant Okay-pop company final 12 months.
Kim’s arrest got here after the Seoul Southern District Court docket accredited an arrest warrant, citing considerations that he might flee or destroy proof.
Prosecutors have as much as 20 days to analyze Kim and decide whether or not to indict him, in keeping with a senior prosecutor at a Seoul district prosecutors’ workplace. He requested anonymity as a result of an investigation was below method.
Kim faces allegations that he orchestrated and accredited schemes to collaborate with the operator of a non-public fairness fund to intentionally inflate the inventory value of Okay-pop company SM Leisure to stop Hybe Corp., the dad or mum firm of one other Okay-pop powerhouse behind international sensation BTS, from shopping for SM Leisure, in keeping with the prosecutor.
Kim, 58, denied the allegations, in keeping with the Seoul prosecutors’ workplace. He was not instantly accessible for remark.
One other Kakao govt and the pinnacle of the fairness fund have already been indicted within the case, in keeping with the prosecutors’ workplace.
Kakao Corp. is greatest recognized for its massively well-liked free cellular chat app, referred to as Kakao Speak. It reportedly had about 41 million lively customers in South Korea, a rustic with 52 million individuals, as of December. The corporate has used the recognition of its cellular messenger to department into banking, on-line purchasing, gaming and different providers in recent times.
Kakao Corp. stated in a press release Tuesday that “the present scenario is regrettable.” It stated it should try to reduce the administration hole however did not straight deal with Kim’s arrest.
Kakao’s inventory value fell greater than 5% on Tuesday.
SM Leisure’s high executives had objected to Hybe’s try to extend possession of the corporate, describing it as a hostile takeover try and saying it will result in monopolization of the business, pushing up prices for followers. It additionally stated that SM artists may not be prioritized if Hybe managed the agency.
SM’s high executives had supported Kakao’s tender supply as a “pleasant” one and described the expertise agency because the “optimum strategic cooperative associate.”