Shares of Korea’s Kakao Jump After Three Execs Quit

Shares of the Korean FinTech giant KakaoPay saw their biggest rise in two months after the company’s top three executives resigned at the same time Thursday (Jan. 20).

As Bloomberg News reports, the departures of Kakao’s CEO, CFO and business chief placated investors who were angry at the way the company sold off shares following its phenomenal initial public offering (IPO) last November.

Chief Executive Officer Alex Ryu, Chief Financial Officer Kijoo Chang and Chief Business Officer Jin Lee all announced their plans to resign Thursday (Jan. 20).

Ryu was due to step down in March anyway, but the resignations of his two chief lieutenants – effective immediately – were a surprise, Bloomberg said. A company spokeswoman said Kakao’s board will vote on Ryu’s departure soon.

Read more: Shares of S.Korea’s Kakao Pay Soar Over 150% on First Day of Trading

The CEO and other executives were lambasted by shareholders for their decision to sell some of their stake following the company’s $1.3 billion IPO, which saw shares in the company soar 150% on their first day of trading last year.

COVID-19 “has fueled transitions to online financial service,” Ryu said at the time. “We were originally targeting the IPO in 2022 or 2023, but the plan has been brought forward because of the steep growth.”

As Bloomberg notes, those sales caused investor sentiment to curdle, leading a selloff that erased more than $25 billion of market value in the company and its affiliates, such as KakaoBank.

The departure came amid Korean media reports that Kakao founder Brian Kim was being investigated for allegations that he had evaded a 886 billion won ($743 million) tax when Kakao merged with Daum Communications in 2014. Kakao has called these allegations “groundless,” and said the merger had been approved by shareholders.

Read more: Korean Regulators Grapple With Next Steps as Techs Firms Expand Into Finance

KakaoPay said recently it is planning to introduce insurance services this year in collaboration with Meritz Fire & Marine Insurance as the two firms create financial products designed for customers between ages 30 and 50.