December 04, 2024

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[THE INVESTOR] Kakao’s planned listing of US$1 billion global depositary receipts is getting strong demand from investors before its official debut next month on the Singapore Exchange.

According to industry sources on Jan. 17, Kakao is currently on a roadshow to meet investors in big financial cities like Hong Kong and London and the shares are already oversubscribed. 

Investors reportedly showed keen interest in the firm’s service businesses running on its immensely popular mobile messenger KakaoTalk, especially mobility services like KakaoTaxi and KakaoNavi.

Unlike earlier predictions, its close ties with Upbit, a local cryptocurrency exchange, seems to be having little impact on the GDR sale.

Kakao, along with its venture capital unit K Cube Ventures, owns a combined 23 percent stake in Upbit. Kakao former CEO Lee Sir-goo also recently joined the exchange as CEO, hinting at a further partnership between the two firms for business expansion.

Kakao shares are on a rollercoaster ride in recent weeks amid the virtual money frenzy here. The stocks reached an all-time high of 166,000 won (US$156.02) in November on high expectations about Upbit’s business outlook but more recently the price is extending a fall as the Korean government has pledged all-out efforts to cool the crypto trading, including a possible shutdown of exchanges. As of 11 a.m., the stock was trading 136,000 won, down 3.21 percent from a day before, on the KOSPI.

Kakao plans to decide the price range of the GDR sale by Jan. 23 and allocate shares to investors. The shares will be listed on SGX on Feb. 3. It plans to use the new funds to acquire new technologies like artificial intelligence and beef up other contents business like music and gaming.

By Lee Ji-yoon (jylee@heraldcorp.com)