On August 23, South Korea’s Kakao Corp. announced that its mobile solutions subsidiary, DK Techin Corp., will merge with its AI technology arm, Kakao Brain. The merger is scheduled to take effect on October 1.
Before the merger takes place, Kakao Brain will separate its healthcare division to form a new entity called “CXR Lab,” which will then be integrated into DK Techin. This move is part of Kakao’s strategy to streamline and consolidate its operations across technology and healthcare sectors.
DK Techin, known for its system integration (SI) and IT support services within Kakao’s ecosystem, will be absorbed into Kakao Brain as part of the merger.
Earlier this year, Kakao already reduced its number of subsidiaries from 138 to 123 and consolidated DK Techin with KEP, a former Kakao Enterprise subsidiary, in March.
Kakao’s CEO, Jeong-Sil An, emphasized during the company’s Q2 earnings call that the company would concentrate on core areas closely tied to the KakaoTalk platform and artificial intelligence (AI). Non-core operations, including the recent exit from the golf equipment sector, will be optimized or eliminated.
This merger and strategic reorganization are part of Kakao’s ongoing efforts to streamline its operations and better align its subsidiaries with its main business objectives.
Additionally, in June of this year, Kakao Brain’s AI development team was integrated into Kakao, further consolidating its technology resources.
The direction for Kakao’s governance reform appears to have been determined last month. Initially, there were discussions about merging Kakao Brain with Kakao Healthcare. However, disagreements over the differing business focus led to the decision for DK Techin to absorb Kakao Brain instead.
The CA Council, Kakao’s central decision-making body, stated that DK Techin is enhancing its AI-based B2B projects. This focus on business-to-business AI solutions aims to support DK Techin’s goals of making a better fit for integrating Kakao Brain’s assets.
Kakao Brain focuses on advancing artificial intelligence technologies and driving innovation in machine learning and AI solutions. It plays a critical role in developing AI-driven products and services within Kakao’s broader ecosystem.
DK Techin, on the other hand, specializes in system integration (SI) and IT support services. It offers comprehensive solutions for managing and optimizing IT infrastructure, contributing to the efficient operation of Kakao’s various technological platforms.
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