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Photo courtesy of Yonhap News |
[Alpha Biz= Paul Lee] SEOUL, Oct. 21 — A South Korean court will deliver its first-instance verdict on Kim Beom-su, founder of Kakao Corp. and current chairman of its Management Innovation Committee, who stands accused of stock price manipulation during the company’s battle to acquire SM Entertainment.
The Seoul Southern District Court’s Criminal Division 15 (Chief Judge Yang Hwan-seung) is scheduled to hold the sentencing hearing at 11 a.m. on Monday. Kim was indicted on charges of violating the Capital Markets Act by allegedly manipulating SM Entertainment’s share price in February 2023 to block a tender offer by rival entertainment giant HYBE.
Prosecutors claim that Kim artificially propped up SM’s stock price above HYBE’s tender offer price, effectively obstructing HYBE’s public acquisition bid. A tender offer refers to a public proposal to buy shares directly from investors, typically at a premium, outside the open market.
During closing arguments in August, prosecutors demanded 15 years in prison and a ₩500 million (US$360,000) fine for Kim. They also sought 12 years in prison and a ₩500 million fine for Bae Jae-hyun, former head of Kakao’s investment division, and ₩500 million in fines each for Kakao Corp. and Kakao Entertainment.
The presiding judge previously remarked that the key issue in this case is “how far in-market stock purchases are permissible during an active tender offer,” noting that both the prosecution and the defense have persuasive arguments. The court said it would deliver a decision “based on fair and objective standards.”
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
