South Korea's Kakao Corp. approved its largest corporate governance overhaul on Friday, dividing the company into KakaoAI — built around the dominant KakaoTalk messaging platform, AI, advertising and commerce — and KakaoX, an investment-focused holding arm for fintech, mobility and entertainment businesses. The demerger, based on a 0.36:0.64 split ratio derived from net asset book values, aims to eliminate a more than 50% conglomerate discount, with the sum-of-the-parts value pegged at 34.2 trillion won against the current market capitalization of 16.8 trillion won. KakaoAI will target at least 6 trillion won in consolidated revenue by 2030 through an agentic AI interface serving approximately 20 million daily active users, while KakaoX sets a 10 trillion won revenue target and will oversee Kakao's core affiliates. Existing shareholders will receive proportional stakes in both entities with no dilution. The split requires shareholder approval at an extraordinary general meeting on December 17, 2026, with legal effect from January 1, 2027, and separate trading commencing January 27, 2027. Founder Kim Beom-su, who holds approximately 24% of both post-split entities, cited the need for agility in the AI era. The announcement triggered an immediate 12% share decline to ₩34,150, reflecting uncertainty over independent valuations despite the structural rationale.