Kakao Mobility Considers Separation from Affiliates Since Last Year's National Assembly Audit

Bae Jaehyun Kakao CIO "Kakao Mobility Considered Removing 'Kakao' from Its Name"

On the 11th, the Kakao Community Union Crew Union held a press conference regarding the sale of Kakao Mobility at Sangyeonjae in Jung-gu, Seoul. Photo by Jinhyung Kang aymsdream@

[Asia Economy Reporter Kang Nahum] It has been revealed that Kakao had been considering separating Kakao Mobility as a subsidiary since last year’s National Assembly audit when the issue of Kakao infringing on local businesses was at its peak.

On the 18th, Pae Jae-hyun, Kakao’s Chief Investment Officer (CIO), stated during an online meeting with Kakao Mobility employees, "After the last audit, we also reviewed the option of removing 'Kakao' from Kakao Mobility’s name and separating it from the group."

He added, "Because there was harsh external criticism about a company with a monopoly position on the Kakao messenger platform continuing taxi and designated driver services, adjusting the shareholding structure became inevitable."

Kim Sung-soo, Chairman of Kakao’s Board of Directors, also said, "There are many external attacks questioning why a messenger company like Kakao is involved in taxi, designated driver, and parking services," adding, "From Kakao’s perspective, giving up management rights is not an easy decision, but it is an unavoidable measure for Kakao Mobility’s growth."

Regarding employees’ concerns about the sale to a private equity fund, CIO Pae said, "People mainly look at the Homeplus case, but from the financial investor’s standpoint, there are businesses aimed at increasing profits and others aimed at increasing corporate value," and added, "Since the acquiring party shares the goal of increasing corporate value, worrying about workforce reductions is a needless concern."

In response, Ryu Geung-sun, CEO of Kakao Mobility, expressed regret over Kakao management’s decision. He said, "I agree with the opinion that the smart call service was rushed, which was one of the issues pointed out during the last audit," but also stated, "On the other hand, I think it was a witch hunt to be attacked just because it was Kakao, even though similar services by Naver or Baemin are socially accepted."

The Kakao labor union also criticized the lack of justification for selling Kakao Mobility. Seo Seung-wook, head of the Kakao labor union branch, said, "I clearly understood the problem through today’s meeting," and added, "Kakao is misdiagnosing the issue. It’s not that the business was witch-hunted because it’s Kakao, but because the management lacked responsibility as a platform."

He raised his voice, saying, "Thinking that other platforms have no problems is very complacent," and emphasized, "Changing the major shareholder is not the core issue; it is time to discuss the social coexistence and growth of the business."

The meeting lasted about 90 minutes but failed to reach a new conclusion. Kakao management plans to hold another communication session to gather opinions from Kakao Mobility employees.

Meanwhile, it was revealed that over 75% of mobility employees opposed the private equity fund sale of Kakao Mobility. Earlier, on the 6th, the Kakao labor union resumed a signature campaign against the mobility sale targeting all subsidiary employees. About 1,600 employees from Kakao subsidiaries participated in the signature campaign.

The Kakao labor union plans to ▲consult with the Kakao CAC Center ▲proceed with collective bargaining for mobility. Additionally, on the 25th, they plan to join the MBK opposition rally led by the designated driver labor union and discuss joint action plans with platform workers.

This content was produced with the assistance of AI translation services.