This article was displayed on the ChosunBiz MoneyMove (MM) site at 5:29 p.m. on Jan. 14, 2026.
It has been confirmed that artificial intelligence (AI) startup Upstage is close to acquiring the portal Daum. The deal will swap shares between Upstage and Daum, and Daum's corporate value is estimated to exceed 200 billion won.
According to the investment bank (IB) industry on the 14th, Upstage is in the thick of due diligence to acquire Daum operator AXZ and plans to sign a stock purchase agreement (SPA) soon. Even if fine-tuning of terms and legal review take longer than expected, the plan is to finalize the contract by the first quarter at the latest.
Daum is a portal site company launched in 1995. Founder Lee Jae-woong established it with 50 million won in capital. It listed on the KOSDAQ market in Nov. 1999, and with the growth of the email service "Hanmail.net" and "Daum Cafe," its stock price soared during the IT bubble, and it held the No. 1 market share in the portal market through 2002.
Daum was merged into Kakao in 2014. Over a little more than 10 years, the gap with top player Naver has grown to the point that comparisons are meaningless. According to market research firm Internet Trend, Naver's share in the domestic search market last year reached 62.86%. Daum's share was 2.94%, ranking fourth after Google and Bing.
In the IB industry, rumors that Kakao would sell Daum began circulating in 2024. Daum has a strong image as a "progressive-leaning platform," and Kakao's senior officials are said to cite Daum as one of the biggest reasons the company fell out of favor with the previous conservative administration. A person in the industry said, "From that time, Kakao had little interest in how much Daum's corporate value would be recognized and wanted to sell even at a low price."
In March last year, Kakao CEO Chung Shin-a personally denied that a sale was being considered, but the industry has viewed the sale as a foregone conclusion since the in-house independent company (CIC) in charge of the Daum business institutional sector was spun off. Kakao established wholly owned subsidiary AXZ in May last year and transferred Daum's core services—news, search, cafe, and email—to AXZ in December.
If Daum is sold in the 200 billion won range, the market views it as receiving a fairly high valuation considering current performance and growth potential.
Kakao's portal biz revenue last year was known to be about 300 billion won. It was around 332 billion won in 2024 as well. That is a 32% decrease from 2021 revenue (492.5 billion won). It has been posting large deficits every year. With about 200 employees handling the Daum business alone, labor cost expenditure is also said to be large.
Upstage, which is set to acquire 31-year-old Daum, is a startup founded in 2020 by CEO Kim Sung-hoon, a former developer from Naver Clova AI. It specializes in AI document automation and the development of large language models (LLMs). Its self-developed LLM "SOLAR" series is its flagship product.
Upstage is said to be seeking to acquire Daum to boost its corporate value ahead of a listing. Upstage last month signed underwriting contracts for the listing with KB Securities and Mirae Asset Securities. The goal is reportedly to be valued at at least 2 trillion won to 4 trillion won. Previously, when it raised investment in August last year, it was valued at 740 billion won.