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Kakao eyes backdoor listing by combining with Daum

By WTOP Staff

YOUKYUNG LEE
AP Technology Writer

SEOUL, South Korea (AP) — Mobile messenger service Kakao Talk is seeking a backdoor listing on the South Korean stock exchange by combining with the country’s second largest Internet portal.

Kakao Corp. and stock exchange-listed Daum Communications Corp. said Monday that Kakao shareholders will get 1.556 Daum shares for each Kakao share they own.

If the deal gets approval from a meeting of shareholders in August, shares in the new entity called Daum Kakao will start trading in October. Kakao’s founder Brian Kim will be the largest shareholder in the new entity. Its market capitalization is expected to be more than 3 trillion won ($2.9 billion).

The deal is the latest in series of mergers and acquisitions in the mobile messenger app market. Earlier this year, Facebook announced a takeover of WhatsApp for $19 billion and Japan’s Rakuten said it will buy Viber for $900 million.

Kakao Talk is South Korea’s most popular mobile messaging service for smartphones. But it has struggled in overseas markets dominated by other mobile apps such as WhatsApp, Line and WeChat.

Daum’s web portal has been a perennial runner-up to Naver, which dominates the South Korea’s Internet market. Its mobile Internet services, such as a messenger app, have been unpopular.

Naver owns Line, which has about 400 million users. The app has been a cash cow for Naver and helped it expand overseas while also adding to competition for Daum and Kakao.

Daum CEO Saehoon Choi said the two companies offer strengths that each is in need of.

Daum, which has 2,600 employees, gets a boost in its mobile service while Kakao, with 600 staff, gets additional resources, such as engineers at Daum, to challenge Line and other messaging apps overseas.

“There was a consensus that we will certainly face a limit in growing organically. It takes too much time to recruit employees one by one and to start a new business one by one,” Sirgoo Lee, CEO at Kakao told reporters. “If we work with Daum, we will save time and upgrade services.”

The two CEOs declined to discuss their business plans overseas.

Hana Daetoo Securities said in a report that Kim, the Kakao founder, will control 33 percent of Daum Kakao. The report said Daum’s founder Lee Jae-woong’s stake in the new entity will be 6 percent.

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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