Kakao: Celebs Rumors

Kakao has been raided by South Korean authorities over allegations that it was involved in stock manipulation over its purchase of SM Entertainment shares.According to a report by English South Korean publication Korea JoongAng Daily, about 40 prosecutors and investigators from the Financial Supervisory Service (FSS) – the East Asian country’s financial regulator – had confiscated data from Kakao’s office in the city of Pangyo in relation to its stock trading activity from February 2023.“The special judicial police at the FSS is presently in the process of investigating if the sale of SM shares is in violation of the Capital Markets Act under guidance from the prosecution,” an FSS spokesperson said in a statement to South Korean press, per Korea JoongAng Daily.“The team is looking into whether there was artificial engagement to sway share prices in a certain direction,” they added.Per The Korea Herald, Kakao are reportedly under investigation for allegedly artificially inflating the stock price of SM Entertainment in an attempt to block HYBE from taking control of the K-pop agency.Back in February, HYBE had launched a tender offer to buy up to 25 per cent of SM Entertainment for ₩150,000 per share. However, HYBE had only been able to acquire 0.98 per cent through that offer, per The Korea Herald.Around the same time, HYBE had submitted a petition to the FSS over an “abnormal” 2.9 per cent purchase of SM Entertainment stocks that had been transacted through a IBK Securities’ branch in Pangyo, according to Korea JoongAng Daily.Kakao has yet to comment on the situation. NME has reached out for comment.Meanwhile, HYBE has since dropped its bid to acquire SM Entertainment following a discussion with Kakao.