According to Bloomberg, South Korean regulators have asked Kakao Pay, which is about to go public, to revise its prospectus. With 36 million users, Kakao Pay is the largest online payment service company in South Korea, with Ant Group holding a 45 percent stake in the company.
Kakao Pay was scheduled to go public on the Korea Exchange on Aug. 12, according to its previously filed prospectus, and intends to raise to 1.63 trillion won by selling 17 million new shares at a price of 63,000 won to 96,000 won per share.
The main underwriters of Kakao Pay's IPO, Samsung Securities, JPMorgan Chase, and Goldman Sachs Group, had valued Kakao Pay's fundraising plan by comparing it with U.S. payment companies PayPal, Square, and Brazilian payment company Pagseguro.
Data shows that Kakao Pay's operating revenue for the entire 2020 increased by more than double to 284 billion won last year, while net loss narrowed by 61 percent year-on-year to 25 billion won.
Kakao Pay CEO Alex Ryu said in an interview that the epidemic has driven a shift in consumer behavior toward online financial services, "Our initial goal was to have an IPO in 2022 or 2023, but the plan was brought forward due to excessive growth."
In February 2017, Ant Group announced a $200 million investment in Kakao Pay, a mobile payment platform owned by the South Korean social platform Kakao Group. Shortly thereafter, Kakao Pay separated from the group and began operating independently.
As of May 2021, Kakao Group held a 55% stake in Kakao Pay, while Ant Group held a 45% stake through Alipay Singapore. Through the partnership with Ant Group, Kakao Pay accesses merchants in Korea that Alipay already has access to, meaning that Koreans can pay with Kakao Pay in offline scenarios and Chinese tourists can pay with Alipay in those scenarios.
Kakao Pay is reportedly working on expanding its business service scenarios. In the interview above, Alex Ryu said that Kakao's payment service is currently available in 600,000 of South Korea's 2.5 million offline stores, and the company plans to expand the number of stores to 1.5 million.
Source: Ant-Backed Kakao Pay Told to Revise Prospectus For Korea IPO
