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Photo courtesy of Yonhap News |
[Alpha Biz= Kim Jisun] SEOUL, October 28, 2025 — South Korean prosecutors have appealed the court’s acquittal of Kim Beom-su, founder of Kakao Corp. and head of its Future Initiative Center, who had been charged with stock manipulation related to the SM Entertainment takeover battle.
The Seoul Southern District Prosecutors’ Office announced on Tuesday that it had filed an appeal, citing factual misinterpretations and legal misjudgments in the lower court’s ruling.
Prosecutors argued that the case involved illegal market intervention during Kakao’s high-profile contest with HYBE for control of SM Entertainment.
“Kakao engaged in illegal price stabilization tactics to obstruct HYBE’s lawful tender offer, misleading ordinary investors and causing significant losses,” the prosecution stated.
The office further claimed that key evidence — including Kakao executives’ internal messages and recorded calls discussing strategies to “block HYBE’s tender offer” — was not adequately considered by the first-instance court.
Prosecutors also cited recordings of post-investigation communications that allegedly show company officials coordinating their narratives after the probe began.
The prosecution acknowledged that the court had raised concerns over the credibility of a key witness who was under separate investigation but pledged institutional reforms to prevent similar issues in future trials.
“Regardless of the judgment’s merits, we take the court’s remarks seriously and will work to strengthen procedural safeguards,” the statement added.
Earlier, on October 21, the Seoul Southern District Court acquitted Kim and other Kakao executives, ruling that large-scale on-market purchases of SM Entertainment shares during HYBE’s tender offer could not alone be deemed market manipulation.
The court found that while Kakao had indeed been pursuing management control of SM, the pattern of stock purchases differed substantially from typical manipulative trading behaviors.
Following the prosecution’s appeal, the case will now proceed to the Seoul High Court for a retrial.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
