Kakao Requests Postponement of Seoul Arena Groundbreaking Ceremony... "Proceed After Cost Reassessment"

Kakao has requested to postpone the groundbreaking ceremony for Seoul Arena, originally scheduled for the 14th. The plan is to proceed after recalculating costs and obtaining board approval.

On the 11th, Kakao stated, "We have requested Seoul City to postpone the groundbreaking ceremony until a thorough review and board approval are completed."

Seoul Arena is a complex cultural facility project to build a K-pop dedicated performance hall with a total of 18,269 seats near Changdong Station in Dobong-gu by 2027 through private investment. Kakao’s subsidiary, 'Seoul Arena,' in which Kakao holds a 98% stake, was selected as the project operator, and Kakao will be responsible for operating and managing the facility for 30 years after completion. The groundbreaking was originally scheduled for last year but was delayed due to setbacks in Kakao’s funding plans, and construction began on the 30th of last month.

The reason Kakao is postponing the groundbreaking ceremony is that the expected construction costs have significantly increased. However, Kakao stated, "Kakao’s commitment to this project remains unchanged, and we will make every effort to ensure the project proceeds. We apologize for causing concern and disappointment to Seoul City, Dobong-gu, and many citizens who love K-pop and performances due to the postponement of the groundbreaking ceremony."

There have been allegations of corruption within Kakao regarding the Seoul Arena project. Kim Jeong-ho, Kakao’s Chief of Management Support, raised suspicions that a specific company was given a sole-source contract during the selection process of the construction company for the project, causing internal conflict, and an internal audit is currently underway.

Meanwhile, Seoul City stated, "We are currently confirming future project plans with Seoul Arena and Kakao."