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[Alpha Biz=(Chicago) Reporter Kim Jisun] Bae Jae-hyun, head of Kakao's investment division, who was arrested on charges of being involved in manipulating the market price during a dispute over SM Entertainment's management rights, has been put on trial.
The Financial Investigation Department 2 (Senior Prosecutor Park Gun-young) at the Seoul Southern District Prosecutors' Office said on the 13th that it has indicted CEO Bae on charges of violating the Capital Market Act. In accordance with the joint punishment regulations, the cacao corporation was also indicted without detention.
According to the prosecution, Bae is suspected of manipulating the market price in February this year with the aim of setting and fixing SM Entertainment's stock price higher than HYBE's public offering price of 120,000 won in order to prevent rival HYBE's acquisition of managerial control during the competition for SM Entertainment's corporate control.
CEO Bae and others were found to have made a total of 409 high-priced purchases of SM Entertainment shares in the market by mobilizing a total of about 240 billion won on February 16∼17 and 27∼28. In the process, he is also suspected of not reporting large stock holdings to the financial authorities.
The special judicial police for the capital market at the Financial Supervisory Service earlier sought arrest warrants for Bae, Kang, head of Kakao's investment strategy office, and Lee, head of Kakao Entertainment's investment strategy division, on such charges on the 13th of last month.
However, the arrest warrants for Mr. Kang and Mr. Lee were dismissed. Since then, it has continued its related investigation by summoning Kakao founder Kim Bum-soo as a suspect on the 24th of last month and sending three people, including CEO Bae, as well as Kakao and Kakao Entertainment to the prosecution on the 26th.
AlphaBIZ 김지선(stockmk2020@alphabiz.co.kr)
