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China News Service, July 22. According to Yonhap News Agency, Kim Beom-soo, founder of South Korean Internet giant Kakao, was subject to a review of the necessity of arrest on the 22nd for suspected malicious manipulation of stock prices during the acquisition of SM Entertainment.

According to reports, the Seoul Southern District Court conducted a review of the necessity of arresting Kim Beom-soo on suspicion of violating the Capital Markets Act. This was 13 days after Kim Beom-soo was summoned by the prosecution. Kim Beom-soo arrived at the court at around 1:43 pm that day, remained silent in response to various questions from the media, and went straight into the court.

According to reports, the prosecution believes that Kim Beom-soo is suspected of investing about 240 billion won (about 1.26 billion yuan) in 4 days (February 16, 17, 27, and 28) to buy SM shares during Kakao's acquisition of SM Entertainment in February last year, in order to raise the stock price and hinder the public acquisition of its competitor HYBE. Among them, February 28 was the deadline for HYBE's public acquisition of SM shares. Because SM's stock price closed at 127,600 won on that day, which was higher than the public acquisition price (120,000 won), HYBE finally gave up the acquisition.

It is reported that when Kim Beom-soo was questioned by the prosecutors, he said that he approved the acquisition after receiving the relevant report, but he did not receive any report on the specific acquisition method and process. On the 18th of this month, he also denied the suspicion when attending the group's emergency meeting and said that he had never instructed or tolerated any illegal behavior.

The report also stated that Kakao's Chief Investment Officer (CIO) Bae Jae-hyun was arrested and prosecuted by prosecutors on the same suspicion in November last year, and was later released on bail in March this year. A representative of One Asia Partners, a private equity fund operating company suspected of colluding with Kakao, was also arrested and prosecuted in April this year and was released on bail on the same day. (China News Service APP)