Kakao announces plan to split into two entities focused on AI and existing businesses

Kakao, a major South Korean IT company, has approved a restructuring plan during a board meeting, which will split the company into two new entities: Kakao AI and Kakao X. The split, based on net asset value, will allocate 36% to Kakao AI and 64% to Kakao X. The move is intended to adapt to the AI era by reorganizing capital allocation. Kakao AI will focus on developing AI agents, with KakaoTalk and Kanana as its core platforms. The new entity aims to integrate Kakao’s extensive services to create unique user experiences and business models. Users will be able to issue commands via KakaoTalk, enabling AI agents to perform tasks such as searching, purchasing, and paying. The company targets a 50% increase in user engagement and a 20% annual revenue growth by 2030, aiming for a revenue of approximately 6 trillion won (around 291.06 billion RMB). Kakao X will manage existing subsidiaries, including Kakao Bank, Kakao Pay, and SM Entertainment, while exploring new areas such as virtual assets and investing in innovative startups. The company plans to hold a special shareholders’ meeting on December 17 and complete the split by January 1, 2027. Kakao AI is scheduled to re-list on the stock market on January 27, 2027, alongside a name change and potential listing for Kakao X.