South Korean court approves arrest warrant for Kakao founder
Kakao founder Kim accused of manipulating SM Entertainment stock to hinder Hybe acquisition
Kim denies accusations, stating no illegal activity was ordered or tolerated
Kakao shares down 24% YTD; regulatory scrutiny may impact AI and expansion plans
By Joyce Lee
SEOUL, July 23 (Reuters) -A South Korean court approved early on Tuesday a prosecution request for a warrant to arrest Brian Kim, the billionaire founder of tech giant Kakao Corp 035720.KS, on accusations of stock manipulation during a 2023 acquisition.
It is the latest legal twist for Kakao after the company and an executive went on trial last year for alleged wrongdoing during the same acquisition.
This is also one of the biggest potential risks faced by Kim, who is seen as a visionary in South Korea's digital industry for building Kakao's group of affiliates - worth a total of 86 trillion won ($62 billion) by assets according to government data - from the ground up since launching its chat app in 2010.
Prosecutors say Kim was involved in manipulation of the stock price of SM Entertainment 041510.KQ in February last year to hinder a competitor, Hybe 352820.KS, from acquiring the K-Pop agency.
Not yet formally charged, Kim has denied the accusations, saying he has never ordered or tolerated any illegal activity, the company said in a statement.
The high-profile tech entrepreneur is the largest shareholder of Kakao Corp, with a stake of 24% controlled by him or affiliated entities.
The Seoul Southern District Court approved the warrant to stem a risk of destroying evidence or absconding, a court official said. The court ruled only on whether a warrant is appropriate, and not on the prosecution's allegations.
Kim's arrest would last up to 20 days, during which prosecutors are expected to investigate further before bringing charges, according to South Korean criminal procedure.
Analysts said the outcome of any case against Kim could also jeopardise Kakao group's control of online bank arm KakaoBank Corp 323410.KS, since the country's financial rules restrict those convicted of financial crime from owning a stake of more than 10% in a bank.
Continued regulatory and social scrutiny is also seen making it tougher for the operator of South Korea's largest chat app to make major decisions on investments in artificial intelligence (AI) and overseas business expansion, they said.
The company plans to introduce new AI services this year.
Kakao Corp shares have fallen 24% year-to-date.
Kim heads a "corporate alignment" council that coordinates the interests of the Kakao group's 128 affiliates and decides what businesses to concentrate on.
($1=1,389.2700 won)
Reporting by Joyce Lee in Seoul;
Editing by Ed Davies, Clarence Fernandez and Matthew Lewis
Últimas noticias
Descargo de responsabilidades: Cada una de las entidades de XM Group proporciona un servicio de solo ejecución y acceso a nuestra plataforma de trading online, permitiendo a una persona ver o usar el contenido disponible en o a través del sitio web, sin intención de cambiarlo ni ampliarlo. Dicho acceso y uso están sujetos en todo momento a: (i) Términos y Condiciones; (ii) Advertencias de riesgo; y (iii) Descargo completo de responsabilidades. Por lo tanto, dicho contenido se proporciona exclusivamente como información general. En particular, por favor tenga en cuenta que, los contenidos de nuestra plataforma de trading online no son ni solicitud ni una oferta para entrar a realizar transacciones en los mercados financieros. Operar en cualquier mercado financiero implica un nivel de riesgo significativo para su capital.
Todo el material publicado en nuestra plataforma de trading online tiene únicamente fines educativos/informativos y no contiene –y no debe considerarse que contenga– asesoramiento ni recomendaciones financieras, tributarias o de inversión, ni un registro de nuestros precios de trading, ni una oferta ni solicitud de transacción con instrumentos financieros ni promociones financieras no solicitadas.
Cualquier contenido de terceros, así como el contenido preparado por XM, como por ejemplo opiniones, noticias, investigaciones, análisis, precios, otras informaciones o enlaces a sitios de terceros que figuran en este sitio web se proporcionan “tal cual”, como comentarios generales del mercado y no constituyen un asesoramiento en materia de inversión. En la medida en que cualquier contenido se interprete como investigación de inversión, usted debe tener en cuenta y aceptar que dicho contenido no fue concebido ni elaborado de acuerdo con los requisitos legales diseñados para promover la independencia en materia de investigación de inversiones y, por tanto, se considera como una comunicación comercial en virtud de las leyes y regulaciones pertinentes. Por favor, asegúrese de haber leído y comprendido nuestro Aviso sobre investigación de inversión no independiente y advertencia de riesgo en relación con la información anterior, al que se puede acceder aquí.
