[Alpha Biz=(Chicago) Reporter Kim Jisun] Prosecutors investigating Kakao's alleged stock price manipulation by SM Entertainment have launched a forced investigation into Kakao founder and former board chairman Kim Beom-soo.

The Seoul Southern District Prosecutors' Office sent prosecutors and investigators to Kim's office on the 22nd to conduct the search and seizure. It has been a week since the Financial Supervisory Service's special judicial police on capital markets sent six officials from Kakao and law firms, including former chairman Kim, to the prosecution on the 15th.

Former chairman Kim and others are suspected of raising SM's share price to more than 120,000 won, the public offering price of HYBE, with the aim of obstructing the public purchase of HYBE at the time of the acquisition of SM. The prosecution believes that Kakao has invested 240 billion won. Former chairman Kim and others are also suspected of not reporting to the financial authorities on the status of stock holdings in the process.

The FSS sent Kakao, Kakao Entertainment corporation and Kakao investment CEO Bae Jae-hyun to the prosecution on the 26th of last month, while the prosecution handed over Bae and Kakao corporation to trial on the 13th.

Earlier this year, Kakao had a dispute with HIVE over the acquisition of SM management rights. In the process, the HYBE asked the Financial Supervisory Service to investigate Kakao, saying it tried to hinder the public purchase by raising the market price with abnormal purchase activities. Kakao and Kakao Entertainment became the largest shareholders by securing 39.87% (20.76% and 19.11%, respectively) of SM shares in March through open purchase.

 

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