Kakao's chief to buy stocks to boost shareholder value

SEOUL, May 17 (Yonhap) -- The head of Kakao Corp., the operator of South Korea's top mobile messenger, said Friday she will buy shares of the company worth 200 million won (US$147,000) every year over the next two years in a bid to boost shareholder value.

"I will purchase 100 million won worth of Kakao's shares twice a year during my term," Kakao CEO Chung Shin-a said in a letter to shareholders. "I will not sell those shares while serving as the CEO."

Shin started her two-year term in March.

She explained the move is aimed to enhance shareholder value, which has been underestimated by the company's sluggish stock price in recent years.

Her announcement came as Kakao's stock price plunged to about one-fourth of its record high of over 170,000 won tallied in June 2021. Its shares closed 0.75 percent lower at 46,450 won on the Seoul bourse Friday.

The company has faced a series of controversies, including a contentious sell-off of stock options by its executives, and stock manipulation allegations involving its founder, Kim Beom-su, and former CEO Hong Eun-taek.

She pledged to help Kakao restore market trust by strengthening its ethics management and improving business quality, in particular, in advertisement and commerce.

Additionally, Chung unveiled Kakao's long-term business plans focusing on artificial intelligence (AI) business and global expansion.

She aims to increase the company's overseas sales, which currently account for 20 percent of the total, driven by rising popularity of its content business, like webtoons.

Kakao will also focus on developing AI-driven services leveraging AI technologies, including a large language model and an image-generating AI model, Karlo, developed by its affiliate Kakao Brain Corp.

nyway@yna.co.kr
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