[News Today] KAKAO DEAL WITH FOUNDER’S ABSENCE

[LEAD]
Kakao chairman Kim Beom-su has recently been arrested involving a stock manipulation case, leaving Kakao into an unprecedented crisis of leadership absence. Ranked 15th among major IT conglomerates, the company faces a challenging time. Kakao aims to minimize the management gap. But concerns grow about its ability to tackle ongoing issues and invest in new ventures, signaling a red alert for its operations.

[REPORT]
The arrest of Kakao Corp.'s founder was unexpected and shocking for the company.

It did not issue its official stance until ten hours after the arrest.

Kim Yo-han / Kakao Corp.
It's an unfortunate situation, but we're trying to minimize the void with CA
Council Co-chair Chung Shin-a at the helm.

The absence of the corporation's chief is unprecedented for Kakao.

Some are concerned that Kim Beom-su 's initiative to restructure the corporation by cutting the number of subsidiaries, which he had been promoting in full gear since taking back the reins to resolve Kakao's crisis, might lose momentum.

The company's pursuit of new growth engines such as artificial intelligence could also be stalled.

Kakao had promised to release its own AI service soon, but its plans will inevitably be stymied.

Prof. Jeon Seong-min / Gachon University
Investment in new technologies must be based on a mid- to long-term vision
rather than on short-term outcomes. It's a difficult decision.

Kakao could also lose its status as the major shareholder of its key subsidiary Kakao Bank, depending on the outcome of the trial.

With legal uncertainty already looming large, some of Kakao's subsidiaries including Kakao Mobility are under investigation by the Fair Trade Commission.

Kakao Group's shares plunged on Tuesday, resulting in its subsidiaries' market capitalization loss of around 1.7 trillion won, or approximately 1.2 billion dollars.