Kakao may sell Kakao Mobility to private equity company

A Kakao T taxi [YONHAP]

Kakao may put Kakao Mobility, a transportation service subsidiary, up for sale instead of taking it public, according to local media reports citing investment bankers on Tuesday.

Kakao said in an electronic disclosure Wednesday that “nothing has been decided," but "Kakao is considering various options to enhance Kakao shareholder value and to foster the steady growth of Kakao Mobility.”

Local media outlets reported Tuesday that MBK Partners, a private equity firm, is in discussions with the tech company to buy 40 percent of Kakao Mobility, the operator of the Kakao T taxi-hailing app. The company was valued at 8.5 trillion won ($6.6 billion) when its shares were traded over the counter in May.

Kakao Mobility selected underwriters in March to go public on the Korea Exchange.

Kakao Mobility is 58 percent owned by Kakao, according to Kakao's annual report. Other shareholders include a Texas Pacific Group consortium, Carlyle Group and LG Corp.

If MBK Partners acquires 40 percent shares from Kakao Mobility, it will become the company’s largest shareholder.

MBK Partners is reported to have proposed the deal.

Financial industry sources said MBK’s acquisition may help Kakao Mobility expand more aggressively. Kakao companies, including Kakao Mobility, came under fire last year for competing with small, independent stores or charging high commissions to service providers such as taxi drivers. Kakao Mobility may be able to avoid criticism to some extent by distancing itself from the tech company if MBK becomes its largest shareholder.

Kakao Mobility began its taxi-hailing service in 2015 and spun off from Kakao in 2017. The Kakao T app has 30 million accumulated member accounts as of now, with 10 million monthly active users.

Kakao Mobility reported a net profit of 27.5 billion won last year from the previous year’s net loss of 37.6 billion won. The annual revenue was 546.5 billion won in 2021, up 95 percent on year.

BY SHIN HA-NEE, KO SUK-HYUN, PARK MIN-JE [shin.hanee@joongang.co.kr]