Kakao Entertainment CEO Kim Seong-su Arrest Warrant... 'Suspicion of Overpriced Acquisition of Drama Production Company'

2020 Acquisition of 'Baram Pictures' Process
False Corporate Valuation Report, etc.
Purchase of a 1 Billion KRW Capital Deficit Company for 20 Billion KRW
Lee Junho, Head of Investment Strategy Division, Under Investigation

The prosecution investigating suspicions of Kakao's acquisition of a drama production company is moving to secure the custody of Kim Seong-su, CEO of Kakao Entertainment, and Lee Junho, head of the investment strategy division.

According to the legal community on the 30th, the Financial Investigation Division 1 of the Seoul Southern District Prosecutors' Office (Chief Prosecutor Kwon Chan-hyuk) filed arrest warrants for CEO Kim and Division Head Lee on charges including breach of trust under the Act on the Aggravated Punishment of Specific Economic Crimes and violation of the Act on the Regulation of Concealment of Criminal Proceeds.

The pre-arrest detention hearing (warrant substantive examination) will be held on the 1st of next month at 2 p.m., presided over by Judge Yoo Hwan-woo, who is in charge of warrants at the Seoul Southern District Court.

CEO Kim and others are suspected of causing damage to the company by inflating the acquisition price through methods such as falsifying the corporate valuation report during the 2020 acquisition of the drama production company Baram Pictures.

[Image source=Yonhap News]

At that time, Kakao purchased Baram Pictures for 20 billion won. The company, which had a capital of 10 million won and had been operating at a loss for several years, was suspected of being purchased and capital increased at a price higher than the market value.

The prosecution suspects that Division Head Lee, who was the head of Kakao Entertainment's business division at the time of the acquisition, conspired with CEO Kim to channel the market price difference to Baram Pictures, in which his wife, actress Yoon Jeong-hee, had invested.

The prosecution summoned CEO Kim and Division Head Lee for investigation as suspects on the 24th.

It is known that the prosecution began a direct investigation after detecting signs of breach of trust while examining Kakao's alleged market manipulation of SM Entertainment, which was referred from the Financial Supervisory Service.

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