Prosecutors Seek 15-Year Term for Kakao Founder in SM Entertainment Appeal

South Korean prosecutors have asked an appeals court to sentence Kakao founder Kim Beom-su to 15 years in prison over allegations that he manipulated SM Entertainment’s share price during a high-profile takeover contest with Hybe in 2023.

At a final hearing before the Seoul High Court on Wednesday, prosecutors repeated the sentence they had requested at Kim’s first trial. They also sought a fine of 510 million won for Kim and urged the appellate panel to overturn the lower court’s acquittal, arguing that the earlier ruling contained errors in its findings of fact and application of the law.

Kim, who heads Kakao’s Future Initiative Center, was indicted under South Korea’s capital markets law. Prosecutors allege that he participated in a campaign to keep SM Entertainment shares above Hybe’s tender-offer price of 120,000 won in February 2023, frustrating Hybe’s attempt to acquire control of the K-pop agency. Kakao later emerged as SM Entertainment’s largest shareholder.

The prosecution says about 240 billion won was used to buy SM shares through 553 transactions. Kim is also accused of violating large-shareholding disclosure requirements by concealing shares held through One Asia Partners, with the disputed holdings representing an 8.16 percent stake in SM Entertainment.

Prosecutors requested a 12-year prison sentence and a 510 million won fine for Bae Jae-hyun, Kakao’s former investment chief, who faces charges in the same case. They also asked the court to fine Kakao and Kakao Entertainment 500 million won each under rules that can hold corporations responsible for offenses committed by their officers.

The first-trial court acquitted Kim in October 2025. It found that testimony from a key witness was not credible and declined to admit that testimony as evidence. The appeal now asks the higher court to reassess both that evidentiary decision and the prosecution’s broader account of the share purchases.

The case remains significant for South Korea’s technology and entertainment industries because it grew out of one of the country’s most closely watched corporate control battles. The appellate court’s eventual decision will determine whether the founder of one of Korea’s largest internet groups remains cleared or faces criminal liability over the acquisition strategy.