South Korean messaging giant KakaoTalk spends $1.5bn on music streaming service
KakaoTalk, South Korea’s most popular mobile messaging app, has bought a majority stake in Loen Entertainment for $1.45bn as it looks to enhance its music offering.
Loen Entertainment owns MelOn, a music streaming service that boasts 28 million users in South Korea, a large amount of which should crossover with KakaoTalk’s 37 million-strong user base, in a country with around 50 million people.
MelOn is the fourth largest music streaming service in the world and the only major service to be based outside the music streaming strongholds of Europe and North America.
According to a report by Yonhap, it marks the biggest single investment for KakaoTalk and will result in the business owning a 74.6 per cent stake in Loen Entertainment.
"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," said Jimmy Rim, CEO of Kakao.
The acquisition adds further features to KakaoTalk which has integrated services such as shopping features and taxi booking apps.