Billionaire Kim Beom-Su, founder of the South Korean technology company Kakao, was taken into custody on Tuesday over accusations of manipulating stocks linked to the firm’s stake in one of the country’s biggest K-pop agencies.
Last year, there was a major bidding war for control of SM Entertainment, a top agency in the entertainment industry. According to prosecutors, the company allegedly manipulated the stock price of SM Entertainment to obstruct Hybe, the company behind BTS, from acquiring the agency. SM Entertainment represents artists such as Girls’ Generation.
Last year, prosecutors indicted Kakao’s chief investment officer and the company on stock manipulation charges. On Tuesday morning, the Seoul Southern District Court confirmed Mr. Kim’s arrest.
Mr Kim has not been formally charged and has denied the allegations.
“The allegations are not true. I have never instructed or condoned any illegal acts.”
Kakao’s messaging and payment apps have become essential infrastructure in South Korea, boasting a market value of around $13 billion. KakaoTalk, a widely used messaging app, is present on over 90 per cent of mobile phones in South Korea.