Kakao founder summoned by prosecutors over alleged stock manipulation in SM takeover

Industry

Published: 09 Jul. 2024, 13:56 Updated: 09 Jul. 2024, 18:59

Kakao founder summoned by prosecutors over alleged stock manipulation in SM takeover

Kakao founder Kim Beom-su [YONHAP]

Kakao founder Kim Beom-su was summoned by the prosecutors’ office on Tuesday for allegedly manipulating SM Entertainment's stock when the messenger giant bought 39.87 percent of the entertainment agency last March.

Kim is suspected of breaching the Capital Markets Act by colluding with private equity fund management company OneAsia Partners to manipulate SM Entertainment’s stock price.

The two parties are speculated to have artificially injected 240 billion won ($173 million) into the market to drive the price of SM shares above 120,000 won to hinder HYBE’s attempt to acquire the stock.

The Financial Supervisory Service previously raided the Kakao founder’s office and Kakao’s Pangyo headquarters last November over the same suspicion.

Kakao and HYBE were locked in a takeover war for SM Entertainment in early 2023, each opting to buy up more shares of SM in tender offers.

Kakao came out as the winner by becoming the agency's largest shareholder with a combined holding of 39.87 percent. HYBE halted the acquisition process last March.

BY CHO YONG-JUN [cho.yongjun1@joongang.co.kr]