Kakao corp, South Korea’s top mobile messenger operator has announced it would be taking over the controlling stake in Leon Entertainment, a music streaming service provider for a deal worth to be $1.57 billion.
KakaoTalk is one of the South Korea’s most sought after mobile messenger which is being used by more than 37 million users in the country with a population of 50 million. On the other hand, the company it plans to acquire Leon operates MelOn which is South Korea’s top music streaming service and has more than 28 million local users. Jimmy Rim, CEO of Kakao said, “Music is one of the most loved content genres in the mobile era. It is also incredibly powerful in that one song can set trends for an entire generation and highly influence global pop culture.”
As per the deal, Kakao will purchase a 76.4% stake worth $1.54 billion in LOEN, operator of MelOn. The acquisition deal is expected to help provide momentum for Kakao’s global debut. Rim added, “By combining Kakao’s various platform and content services and Leon’s leading music content, we expect tremendous synergy that could establish a strong foundation for global expansion.”
Kakao started from a merger between South Korea’s online portal operator Daum Communications corp and then-Kakao Corp. in 2014. Since then Kakao has been rolling out various services on the back of its strong local users which includes mobile wallets and taxi services.
Music and entertainment sector is much sought after in Korea, especially with the Korean vibes spreading across most of Asia and beyond for almost two decades now. Very recently, MyMusicTaste, a South Korean crowdsourcing platform for concerts was reported to have received $10 million in a Series A funding round.