This article was displayed on the ChosunBiz MoneyMove (MM) site at 4:20 p.m., Jul. 30, 2026.
Texas Pacific Group (TPG), a private equity fund (PEF) manager and the No. 2 shareholder of Kakao Mobility, is pushing to recoup its investment through a listing of American depository receipts (ADR) but appears to be making little headway as the largest shareholder, Kakao, is not actively cooperating.
Issuing ADRs based on TPG's existing shares in Kakao Mobility is possible in itself. But many experts say the listing on a U.S. exchange cannot be completed without Kakao Mobility's consent and practical cooperation as the original issuer. As long as Kakao, which effectively wields decisive influence over Kakao Mobility's management, does not move, it will be difficult for TPG to push ahead with an ADR listing on its own.
◇ Likely to choose the secondary DR route… cooperation from the company is essential even with registration rights
According to the investment banking (IB) industry on the 30th, TPG is actively pursuing an exit through Kakao Mobility's listing of American depository receipts (ADR). To that end, it recently appointed Lee & Ko as legal counsel. It had earlier selected Bank of America (BofA), Morgan Stanley and UBS as bookrunners.
The TPG consortium (TPG, Korea Investment PE, Orix PE, JC Partners, BlackRock, GEM Capital, OA Mobility LLC, Topanga) has invested a total of 640 billion won in Kakao Mobility since 2017, securing about 29% equity as the No. 2 shareholder. This deal is highly likely to proceed by converting existing shares held by TPG and other existing shareholders into ADRs and selling them to U.S. investors. However, it has not yet been decided whether the ADR conversion will be limited to TPG's equity or include the stakes of other investors in the consortium.
DRs are broadly divided into three practical types depending on how the underlying original shares are prepared. If a company issues new shares and creates DRs based on them, it is a "primary DR"; if it uses treasury shares held by the company, it is an "existing-share DR." When existing shareholders like TPG deposit their shares with a depositary and convert them into DRs, it is commonly called a "secondary DR."
The recent ADR by SK hynix was a primary DR in which the company issued new shares and raised funds in the United States. By contrast, in Kakao Mobility's case, the focus is on the equity recovery of existing financial investors (FI) rather than new fund-raising by the company, making it highly likely to proceed via a secondary DR. Instead of issuing new shares, the structure uses shares held by existing shareholders as the underlying stock.
However, a secondary DR does not mean an existing shareholder can independently list its equity on Nasdaq while excluding the issuer. Listing procedures are not completed simply by depositing shares with the depositary bank. As the issuer, Kakao Mobility must file Form 20-F with the U.S. Securities and Exchange Commission (SEC) and disclose a wide range of financial and non-financial information, including audited financial statements, business status, risk factors, major shareholders and management, and material contracts and litigation. The ADR itself and the deposit agreement are registered by the depositary bank through Form F-6. If the structure involves a public offering of TPG's existing shares to U.S. investors, separate registration statements, such as Form F-1, may also be required depending on the transaction method.
Kakao Mobility's consent is also required under domestic procedures. Article 187(3) of the Enforcement Decree of the Financial Investment Services and Capital Markets Act requires, in principle, that when a foreign depository and settlement institution acquires existing shares issued by a domestic corporation to issue DRs overseas, it must obtain prior consent from the issuer. In the end, unless Kakao Mobility agrees to the acquisition of the underlying shares by the foreign depository and settlement institution and cooperates with listing procedures such as SEC filings, due diligence, and information provision, TPG will find it difficult to complete an ADR listing on its own.
The shareholders' agreement TPG signed with Kakao Mobility is said to include certain cooperation rights related to listing and securities registration. In the industry, there is talk that it may include "registration rights," which allow a shareholder to request the company's cooperation in registration procedures so the shareholder can sell its shares on the public market. However, it has not been confirmed whether such rights extend to a U.S. ADR listing or what the specific conditions for exercise are.
Still, having registration rights does not mean TPG can execute an ADR listing directly while excluding Kakao Mobility. If Kakao Mobility fails to fulfill its contractual duty to cooperate, TPG can pursue contractual remedies such as specific performance or damages, but the specific recourse depends on the shareholders' agreement. TPG cannot submit SEC registration documents on behalf of Kakao Mobility's management, nor can it provide materials to the auditor, depositary bank, or bookrunners.
◇ Tepid Kakao… limited coercive tools for TPG
Although TPG needs Kakao's cooperation to make the ADR listing happen, Kakao is said to be maintaining a lukewarm stance, according to industry sources. Some even say "Kakao does not want an ADR listing."
One reason cited for Kakao's tepid attitude toward an ADR listing is tighter dual-listing regulations. If Kakao Mobility enters Nasdaq, it is highly likely to be interpreted as a dual-listing structure in which Kakao, a domestically listed company, separately lists a key subsidiary on an overseas exchange.
Detailed dual-listing standards recently released by financial authorities require that when a subsidiary is listed on an overseas exchange, shareholder protection procedures equivalent to those for a domestic listing be applied. Under these standards, the Kakao board must assess the impact of a Kakao Mobility listing on general shareholders and prepare protection measures. It must communicate with shareholders to gather opinions and, if necessary, confirm consent through a shareholders' meeting. The board must then vote for or against pushing ahead with the listing, notify Kakao Mobility, and disclose the execution status at each stage. This process must undergo prior deliberation and resolution by an independent special committee.
It is also a burden for Kakao that this ADR focuses more on equity recovery by financial investors (FI) such as TPG than on funding growth for Kakao Mobility. If ADRs are issued using only FIs' existing shares as the underlying, the listing proceeds will not flow into Kakao Mobility but go to the investors who sold the shares. For Kakao's general shareholders, this structure raises the risk of a holding-company discount due to the separate listing of a key subsidiary, while neither Kakao nor Kakao Mobility directly secures funds.
A legal source said, "Even if it is formally a transaction to list on a U.S. exchange, since Kakao Mobility is a domestic company and Kakao is a domestically listed parent, it is hard to avoid domestic financial authorities' dual-listing policy and shareholder protection requirements," adding, "Even if TPG holds registration rights, without clear cooperation from Kakao and Kakao Mobility, it will be difficult to realize an ADR listing within the year."
Some in the industry say Kakao recognizes that the contractual powers of the TPG consortium alone are not enough to effectively force Kakao to cooperate with a sale or listing, which explains its lukewarm stance on exit talks. An IB industry source said, "The burden of dual listing is only a surface rationale; in reality, Kakao may feel no urgency to cooperate quickly, judging that TPG has limited means to force Kakao to move."
The TPG consortium does not have drag-along rights to require Kakao to sell its equity together, and is understood to have secured only tag-along rights that allow the consortium to sell its equity on the same terms if Kakao sells a controlling stake to an external party. Accordingly, it is impossible for the consortium to independently pull Kakao's equity into a transaction to clinch a sale of control. While rights of first refusal are set among the financial investors (FIs) composing the consortium so they can take priority if the other party sells its equity, no such rights exist between Kakao and the TPG consortium.
A Kakao spokesperson said, "We are reviewing all possibilities to enhance investor value, but it is difficult to confirm details."