Kakao Pay aims to go public in the first half of next year
Kakao’s mobile payment service Kakao Pay is preparing to go public by the first half of next year confirmed the company's spokesperson on Monday.
Kakao Pay reportedly submitted an application to the Financial Supervisory Service (FSS) to receive audits ahead of preliminary approval. The mobile payment service will be the second member of the Kakao family, after Kakao Games, to go public.
The underwriter for Kakao Pay’s initial public offering (IPO) is KB Securities. The company did not give any details on exactly when it will start trading on the local stock market.
The mobile payment service said it qualifies for both the Kospi and the Kosdaq market, but is undecided over which it will go public on.
“While there could be many variables including the situation in the stock market, we are preparing for an IPO. We hope to secure a new growth engine through public funding and aggressively grow our businesses,” said an official statement from the company.
Kakao Pay is currently the most used mobile payment service in Korea. It has around 34 million users contributing to more than 70 trillion won ($60 billion) of transactions this year, according to a report by Shinyoung Securities.
Its second-largest shareholder is Chinese Ant Financial, the operator of Alipay, which has a 43.9 percent stake in the company. Alipay Singapore Holdings invested 230 billion won in the company when it first came out in 2017 and made an additional investment of 115 billion won in June. The biggest shareholder is Kakao, which owns 56.1 percent.
The company holds multiple financial businesses under its belt. Kakao Pay acquired Baro Investment & Securities this year and launched a brokerage subsidiary to sell investment products and provide asset management services. It’s also soon to open an online-only insurance company.
“Kakao Pay is currently valued at 7 trillion won among analysts. The company seems to be rushing for an IPO in an attempt to expand its financial business. It will definitely affect other mobile payment services like Toss and NHN Payco,” said analyst Yun Eul-jeong from Shinyoung Securities.
“Whether it will have an impact on commercial banks is hard to know, since the company is smaller in size and closer to an internet platform than a financial institution.”
More affiliates of Kakao are waiting in line to be traded publicly. Kakao’s online-only bank Kakao Bank announced on Sept. 23 that it would push for a public offering this year.
Shares of Kakao rose 4.98 percent or 17,500 won following the IPO announcement.
BY KANG JAE-EUN [firstname.lastname@example.org]