February 15, 2018
Kakao Mobility, the cab-hailing and transport services unit of South Korea’s mobile services giant Kakao, is acquiring local car pool startup Luxi for KRW25.2 billion ($23.3 million), the company said in a statement posted on its Korean website.
Kakao said it wants to utilise Luxis carpool to complement Kakao Mobility taxi-hailing service, especially during peak times, when taxi demand is high.
Kakao Mobility said, it has been running short of drivers to meet surging demands during peak hours, holidays, and late nights. The number of bookings to Kakao Taxi app already averages 2.4 million on a daily basis, it added.
On December 18 alone, Kakao Taxi, the most popular cab-hailing app in South Korea, received 200,000 calls from customers between 8 a.m. and 9 a.m. but only 26,000 taxi units were available during that time, the company said.
“Kakao Mobility plans to run the carpool service only within specific time periods where there is high demand for taxis,” the company said in a translated quote from its website.
Luxi, founded in 2014, launched its carpool service in 2016. It has since become one of the major carpool service operators in the country.
The startup aims to maximize the synergy between the two companies by utilizing various Kakao platforms, sharing infrastructure, and know-how from Kakao Mobility.
“Luxi is a partner who understands the vision of Kakao Mobility, which is to make every moment of the journey faster, safer, and more convenient,” said Kacao Mobility CEO Joo-Hwan Jung.
Kakao earlier listed its global depository receipts (GDRs) on the Singapore Exchange, raising $1 billion from foreign investors to fund its M&A plans, including acquiring content providers in Japan and the United States.
Bae Jae-hyun, an executive vice president at Kakao, was quoted by Reuters as saying that Kakao could spend more than 70 per cent of the money raised from the listing of its global depository receipts on M&A and acquire companies this year and in early 2019.
Kakao has been seeking to diversify and reduce its reliance on its messaging app, which has come under pressure from rivals. The company counts an affiliate of Tencent Holdings among its investors.
For 2018, Kakao said it will continue to evolve Kakao Talk into an all-in-one life platform while incorporating it’s A.I. technology into key services. It also plans to expand its global reach through Webtoon, game, music, video and other content services.
Strengthening Kakao’s advertising and commerce business will also be a top focus while finding new ways to increase synergy among its subsidiaries and partners via Kakao T and Kakao Pay.
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