Alphabiz - Ant Group’s Stake Sale Sparks Concerns Over Kakao Pay Stock Volatility

Photo courtesy of Yonhap News

[Alpha Biz= Paul Lee] Seoul – Investor concerns are mounting over Kakao Pay (KOSPI: 377300) as its second-largest shareholder, Ant Group’s Alipay, accelerates the disposal of its stake.



On September 3, Kakao Pay shares plunged nearly 10% in a single session after Alipay disclosed the issuance of overseas exchangeable bonds (EBs) backed by 11.45 million shares, equivalent to 8.47% of Kakao Pay’s outstanding stock.



This follows a series of stake reductions by Alipay:

July 2024 – issuance of EBs backed by a 3.55% stake (4.80 million shares)

June 2022 – disposal of a 3.8% stake (5 million shares) via block deal

March 2023 – disposal of a 2.2% stake (2.95 million shares) via block deal



Analysts warn that the overhang risk from large-scale potential selloffs could weigh on Kakao Pay’s stock, regardless of its underlying fundamentals. Even if all recently issued EBs are converted into shares, Alipay will remain Kakao Pay’s second-largest shareholder with a 19.44% stake. Market participants expect further stake reductions, possibly through additional block deals.



Im Hee-yeon, analyst at Shinhan Investment & Securities, commented:
“The repeated stake disposals by Kakao Pay’s second-largest shareholder are likely to slow down any re-rating momentum during stock rebounds. Given the remaining stake, there is a high probability of further market disposals, which will continue to pressure supply-demand dynamics and fuel volatility in the near term.”

Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)