Kakao Corporation founder Kim Beom-su was detained Tuesday on charges of stock manipulation related to the company's acquisition of K-pop powerhouse SM Entertainment last year. 

The Seoul Southern District Court granted the prosecution’s request for a pretrial detention warrant for Kim on charges of violating the Financial Investment Services and Capital Markets Act, citing risks of him fleeing and destroying evidence. 

Kim and other company executives are accused of inflating the share prices of SM in a bid to obstruct a takeover in February last year by Hybe, the parent company of BTS' management agency BigHit Music.

Prosecutors suspect Kakao schemed with a private equity fund operator to purchase around 240 billion won, or some 173 million U.S. dollars, worth of SM shares, driving up prices well above the 120-thousand won per share Hybe was offering small shareholders, thereby undermining Hybe's tender offer.

Hybe eventually suspended its bid, allowing Kakao and its subsidiary to jointly secure a nearly 40-percent stake in SM to gain management control.