The Kakao Labor Union is taking action against the company's plan for a corporate split. The union is urging members and minor shareholders to express their opposition to the small merger between Kakao and Kakao Investment, and is considering joint action with minor shareholders depending on the company's explanations and negotiations in the future.
On September 11, the Kakao branch of the National Chemical, Textile, and Food Industry Workers' Union stated its opposition, citing insufficient explanations and protective measures for workers and shareholders regarding the corporate split.
Kakao plans to restructure its business into 'KakaoX,' which will handle investment and portfolio management, and 'KakaoAI,' which will focus on AI technology-based services. The union pointed out that while the company has presented the split structure and timeline, it has not adequately explained the necessity of the split, the issues that cannot be resolved under the current structure, or the burdens and risks associated with the split.
The union also demanded specific protective measures for employment and working conditions. It insists that the company must clearly outline staffing standards, wage, evaluation, welfare, and tenure guarantees for each entity, and provide written assurances regarding employment retention in the event of organizational restructuring or redundancy.
Concerns were also raised about KakaoX's responsibilities for subsidiary investments, sales, and asset liquidity following the split. The union emphasized the need for pre-established principles regarding employment succession, labor condition protection, and prior consultation with the labor union in case of business transfers, sales, or changes in control.
Additionally, the union called for transparency for minor shareholders. It highlighted the potential risks to shareholder value during the post-split period, including additional listings, capital increases, and transactions between related companies, stressing the need for clear disclosure of the basis for split value assessment and subsequent business restructuring directions.
Meanwhile, Kakao is also pursuing a small merger with Kakao Investment, scheduled for January 1, 2027. The surviving company will be KakaoX (tentative name), and the merger will be conducted with board approval instead of a shareholders' meeting.
The union is encouraging its members to participate in expressing opposition to the small merger with Kakao Investment. If shareholders holding more than 20% of the total issued shares oppose within the designated period, the merger can only proceed with board approval. The union views this opposition as a separate action from the process opposing the corporate split itself, demanding that the opinions of workers and shareholders be reflected in the governance restructuring process, and is considering joint action with minor shareholders if necessary.
Kakao branch president Seo Seung-wook stated, “The company must first answer why the split is necessary now and how it will protect the employment of workers and the value of minor shareholders.”
* This article has been translated by AI.
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