Upd Prosecutors request arrest warrants for Kakao over alleged stock manipulation during SM Entertainment acquisition

    Prosecutors request arrest warrants for Kakao over alleged stock manipulation during SM Entertainment acquisition
    Prosecutors have requested arrest warrants for Kakao executives and employees over alleged stock manipulation during an acquisition…
    www.allkpop.com


    Prosecutors have requested arrest warrants for Kakao executives and employees over alleged stock manipulation during an acquisition of SM Entertainment.

    According to the Financial Supervisory Service and the Seoul Southern District Prosecutors Office on October 13, prosecution requested arrest warrants for Kakao's investment representative, the head of the investment strategy office, and the head of Kakao Entertainment's investment strategy division. Reports say those charged allegedly interfered with an offer from HYBE, which was competing to acquire SM Entertainment, by manipulating stock prices.

    This past February, HYBE made a public offer for SM Entertainment stocks in the amount of 120,000 Won ($88.96 USD) for each stock. The Financial Supervisory Service is now asserting Kakao invested 240 billion Won ($177,922,080.00 USD) to prevent the offer from moving through, which violates the Capital Markets Act. Kakao also did not disclose the stock holdings during the process, which violates the same law.

    The reports are bad news for Kakao, which is facing sluggish performance and stock prices. A securities firm expert stated, "We cannot predict the outcome of the trial, but if it's found that SM shares were acquired unfairly, it could be a huge blow to Kakao Entertainment."

    Quote from kamonohashi

    they should've invested that money on ive instead. maybe that way they the girls would've gotten better quality songs and a better album cover

    They did and have been doing so since debut


    Kitsch - Melon Peak #1, 496,449 ULs

    Either Way - Melon Peak #12, ~125,000 ULs

    Both pre-release title tracks released on Monday. Difference = 375,000 ULs

    It is not organically possible to suddenly drop 75% of your ULs or 375,000 ULs, or conversely suddenly go up 375,000 ULs organically.

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    Kakao legal reps. denied the allegation regarding the market price manipulation during the tender offer of SM Ent. against HYBE.

    "It was a legitimate stock purchase to secure stake, there's no market price manipulation."

    An arrest warrant was made against 3 Kakao Investment Group's director for violating the capital market acts. Acc. to the investigation, they're suspected of consipiring to manipulate market price of SM shares to hinder the tender offer of HYBE. Police also judged they didn't comply with the obligation to report the stock holldings.

  • AllKill VIP

    so basically these days

    if you bid over one company

    with higher price or something

    then you are a criminal?


    wtf

    weren't they bidding in same time?


    in any other place the higher bid wins and case is closed

    what's going on here?

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    Like 1 facepalm 1

    Yes, yes.... we are all aware about it, thanks for pointing it out for 100000 times in every post related to Ive. Can you get at least a new arguments against the girls?

    oh i just meant the songs itself. was kinda hoping for better music. i'm not really a charts dude

    FSS has applied for arrest warrants for three Kakao/Kakao Ent executives including Chief Investment Officer, Bae Jae-hyun and heads of the investment strategy departments for Kakao and Kakao Entertainment, for alleged violations of the Capital Markets Act.FSS alleges that the suspects spent more than 240B to manipulate SM Ent’s stock price above Hybe’s tender offer price in February in order to sabotage Hybe’s takeover bid. FSS also alleges the suspects failed to report their large acquisitions of SM Ent shares in violation of the 5% reporting rule (which requires any entity owning more than 5% to file disclosures when buying or selling shares).

    Kakao says that they engaged in a legitimate market purchase to gain control of SM Ent in a battle with Hybe and there was no market manipulation and no damage to Hybe or SM minority shareholders. https://news.kbs.co.kr/news/pc/view/view.do?ncd=7792616

    Note: Arrest warrants are issued when a judge is convinced that the suspect is either a danger to the community or a flight risk.

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    Quote from Vivi1388

    FSS has applied for arrest warrants for three Kakao/Kakao Ent executives including Chief Investment Officer, Bae Jae-hyun and heads of the investment strategy departments for Kakao and Kakao Entertainment, for alleged violations of the Capital Markets Act.FSS alleges that the suspects spent more than 240B to manipulate SM Ent’s stock price above Hybe’s tender offer price in February in order to sabotage Hybe’s takeover bid. FSS also alleges the suspects failed to report their large acquisitions of SM Ent shares in violation of the 5% reporting rule (which requires any entity owning more than 5% to file disclosures when buying or selling shares).

    Kakao says that they engaged in a legitimate market purchase to gain control of SM Ent in a battle with Hybe and there was no market manipulation and no damage to Hybe or SM minority shareholders. https://news.kbs.co.kr/news/pc/view/view.do?ncd=7792616

    Note: Arrest warrants are issued when a judge is convinced that the suspect is either a danger to the community or a flight risk.

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    Anyone please explain it to me like I'm 5. I hate stocks and number but I'm noisy af.

  • Vivi1388

    Changed the title of the thread from “Prosecutors request arrest warrants for Kakao over alleged stock manipulation during SM Entertainment acquisition” to “Upd Prosecutors request arrest warrants for Kakao over alleged stock manipulation during SM Entertainment acquisition”.

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    The FSS continues to investigate Kakao...This time, the Financial Supervisory Service summoned former Chairman Kim Beom-soo for questioning. It is reported conversations between Kakao employees about stock price manipulation have been secured

    The FSS reportedly found recordings, texts, and more on the cell phones of Kakao executives, showing evidence of price manipulation. The recordings reportedly include employees discussing buying shares above a certain price in order to block Hybe's tender offer

    Quote from Vivi1388

    The FSS continues to investigate Kakao...This time, the Financial Supervisory Service summoned former Chairman Kim Beom-soo for questioning. It is reported conversations between Kakao employees about stock price manipulation have been secured

    The FSS reportedly found recordings, texts, and more on the cell phones of Kakao executives, showing evidence of price manipulation. The recordings reportedly include employees discussing buying shares above a certain price in order to block Hybe's tender offer

    interesting, they actually went through the effort of confiscating phones for evidence, maybe they’ll have laptops too

    It wasn't that they bid with a higher price


    They snapped up SM stock, thereby pumping money into SM. When that happens, SM stocks increase in value and then Hybe's originally fair offer then starts looking like a lowball. Kakao counter bids with the new fair price which is higher than the last valuation and so they win out. Hybe got whaled hard is what allegedly happened.


    So they didn't bid at a higher price, they first fixed the price higher through market manipulation and THEN bid using that higher price to guarantee that their bid would be successful.

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