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(LEAD) Kakao Entertainment to close Tapas Entertainment's Korean branch next month

Entertainment 14:49 March 14, 2023

(ATTN: UPDATES with Naver's layoff at subsidiaries in last four paras)

SEOUL, March 14 (Yonhap) -- Kakao Entertainment plans to close the Korean unit of Tapas Entertainment, a North American webtoon and webnovel platform, next month, industry sources said Tuesday.

The entertainment arm under tech giant Kakao Corp. has recently notified Tapas Entertainment's employees of its plan to liquidate the Korean unit and offered consolation money to those who wish to retire, sources said.

After its closure, Kakao Entertainment is expected to absorb the Korean office's marketing and platform management departments.

"(Kakao Entertainment) decided to liquidate the Korean branch to improve business efficiency and competitiveness," a Kakao Entertainment official said, asking not to be named.

Kakao Entertainment acquired Tapas Media, a major webtoon platform in North America, for US$510 million and Radish, a large U.S. webnovel company, for $510 million in 2021 and merged them to establish Tapas Entertainment last year.

The logo of Kakao Entertainment is seen in this file image. (PHOTO NOT FOR SALE) (Yonhap)

The logo of Kakao Entertainment is seen in this file image. (PHOTO NOT FOR SALE) (Yonhap)

Kakao is one of the major tech companies that are streamlining their sluggish subsidiaries to brace for a recession.

Naver, the nation's leading portal operator, has recently laid off about 15 percent of the workforce at Wattpad, a Toronto-based storytelling platform operator it acquired in 2021.

In a post on the company's bulletin board on March 8, Nam Kyung-bo, interim CEO of Wattpad, said the company let go of 42 employees out of a 267-person team to realign its business in accordance with the changing environment.

"As you all know, the global economic environment fundamentally changed last year and we don't have immunity to this," Nam wrote.


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