Upstage Pursues Acquisition of Daum Portal... Transitioning to an AI-Driven Platform

MOU Signed Between Kakao, Parent Company of Daum Operator AXZ, and Upstage

Sunghoon Kim, CEO of Upstage

Upstage is set to engage in an equity swap with Kakao, contingent upon the acquisition of the internet portal Daum.

On January 29, both Kakao, the parent company of AXZ, which operates Daum, and Upstage held board meetings and approved the signing of a memorandum of understanding (MOU) for a stock swap transaction.

Kakao will transfer its shares in AXZ to Upstage, while Kakao will acquire a certain stake in Upstage. Currently, AXZ is a wholly owned subsidiary of Kakao.

AXZ was spun off from Kakao in May of last year and has been launching new services to respond to the evolving artificial intelligence (AI) industry environment.

Upstage, which has been seeking business expansion opportunities based on its large language model (LLM) "Solar," proposed a collaboration with AXZ, which possesses a broad user base and extensive content data.

If the transaction is finalized following due diligence by both companies after the signing of the MOU, Upstage plans to enhance its AI capabilities using Daum's content data and to establish a next-generation AI platform by integrating Solar with Daum's services.

The two companies expect that their combination could also create synergies for Upstage's "proprietary AI foundation model" project.

Sunghoon Kim, CEO of Upstage, stated, "If Upstage's AI technology is combined with Daum's nationwide user base, it will create an environment where more users can utilize AI easily and naturally."