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[Alpha Biz= Reporter Kim Jisun] Prosecutors Seek Arrest Warrant for Kakao Founder Kim Beom-soo over SM Stock Manipulation Allegations

Prosecutors are seeking to detain Kim Beom-soo, the founder and chairman of Kakao’s Management Innovation Committee, over allegations of stock manipulation involving SM Entertainment.

The Seoul Southern District Prosecutors' Office summoned Kim for overnight questioning on the 9th, and today, eight days later, requested an arrest warrant for him on charges of violating the Capital Markets Act.

Kim is accused of manipulating SM Entertainment’s stock price in February last year to thwart a public tender offer by competitor HYBE. He allegedly aimed to set and maintain SM Entertainment’s stock price higher than HYBE’s offer price of 120,000 KRW.

Prosecutors believe that Kakao, on February 16-17 and 27-28, used approximately 240 billion KRW to purchase SM Entertainment shares in 553 high-priced transactions.

Previously, prosecutors indicted Bae Jae-hyun, Kakao's Head of Investment, and Kakao Corp. for the same charges. Bae has denied the allegations, claiming the actions were part of free competition in the capital market and not illegal.

 

 

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