Bo-eun leads the digital content team. She has covered foreign affairs, North Korea, tech, economy and gender issues at The Korea Times. She did a short stint at the South China Morning Post in Hong Kong, where she obtained a new perspective on news production and life. Small sources of joy for her are lounging in the sun, having a good latte and swimming.
Kakao vows to boost shareholder value via IPO
By Kim Bo-eun
By Kim Bo-eun
Kakao's chief executive said Tuesday the company plans to boost shareholder value through planned initial public offerings (IPOs) of its affiliates.
“Kakao's investor portfolio has been diversifying with the composition of investors being led by Koreans at 68 percent, followed by those from the United States and Europe at 9 percent each. KakaoTalk will take the central role in terms of expanding group-wide businesses and this will help strengthen the core competency of Kakao Group. Plus, we plan to boost shareholder value through planned IPOs of the group's affiliates,” CEO Yeo Min-soo told investors during a conference call upon announcing fourth-quarter results.
With an estimated value of 10 trillion won, Kakao Group is already larger than the four biggest Korean financial groups. The group said it was able to thrive due to key factors, the biggest of which is synergy through KakaoTalk and Kakao Bank.
Chief Investment Officer (CIO) Bae Jae-hyun said Kakao plans to expand its sales of paid content in Southeast Asia this year. “We are eyeing intellectual property (IP) centric businesses there. When it comes to growth of Kakao Japan's paid content, we aim to achieve at least 1 trillion won in volume transactions by this year,” he said.
Bae said he expects Kakao's mobility business to break even this year, at the earliest. Kakao recently identified this sector as one of its new growth engines.
“KakaoPay's MyData business will be launched as a type of beta service in the latter half of the year. When it comes to delays in approval from financial regulators for the MyData business, we believe this is a matter of communication between the regulators in South Korea and China,” the CIO told investors.
Kakao posted record sales on an annual basis last year powered by paid ads on KakaoTalk as well as new businesses in mobility, fintech and content. Total sales in 2020 reached 4.15 trillion won, up 35 percent year-on-year. Operating profit stood at 456 billion won, surging 121 percent over the same period.
Kakao's intellectual property business, in particular, was driven by growth in the sales of KakaoM's video content including dramas and increased sales coming from audio, marking growth rates of 30 percent quarter-on-quarter, and 25 percent year-on-year. KakaoM is involved in the production and distribution of music and video content.
Kakao has designated entertainment content as a key area of business. The group said last month it is integrating KakaoM with another content unit, KakaoPage, to set up a new entity, Kakao Entertainment, to strengthen its content business and make inroads into overseas markets. KakaoPage holds intellectual property rights to 8,500 original stories, including webtoons and web-based novels.
Sales from Kakao's platform division in the fourth quarter also grew 48 percent year-on-year, and 19 percent quarter-on-quarter.