Kim Beom-su, the founder of Kakao Corporation and current head of the company's Future Initiative Center, appeared for financial authorities' questioning over alleged stock manipulation in Kakao's acquisition of SM Entertainment.

Prior to questioning by the Financial Supervisory Service(FSS) on Monday, Kim did not answer when asked whether he admits to the allegations, instead saying he will faithfully cooperate in the investigation.

The company's management is suspected of inflating share prices of SM, one of the country's major K-pop management firms, in an alleged obstruction of a takeover bid earlier this year by Hybe, the parent company for BTS' management agency BigHit.

After acquiring a 14-point-eight percent stake of the company from SM founder Lee Soo-man, Hybe had offered to buy up stocks from small shareholders at 120-thousand won per share.

The FSS suspects Kakao schemed with a private equity fund operator to inject around 240 billion won, or around 177 million U.S. dollars, into the market, thereby surpassing the tender offer price set by Hybe. Kakao is also accused of failing to fulfill the compulsory declaration on their stock acquisition.

Hybe eventually suspended the bid when share prices exceeded the offered price, allowing Kakao and its subsidiary Kakao Entertainment to jointly secure nearly a 40-percent stake in SM to gain management control.

While a Seoul court issued a pretrial detention warrant for Kakao chief investment officer Bae Jae-hyun last week, the FSS is expected to question the Kakao founder on how much he was briefed in the process and what orders he had given.