[Edaily Marketin JI YEONG-EUI YunJi Kim Soyoung Park Reporters] “(Cash Cow) is planning an IPO for 2021”
“Cash Cow could also go public through a merger with BSG Partners”

These were the listing plans personally revealed by Cash Cow CEO Seol Mo at the 2019 and 2021 shareholders’ meetings. Transcripts of Cash Cow’s shareholders’ meetings and emails from management contain evidence that CEO Seol presented an IPO as the company’s primary growth goal and even outlined specific plans.

However, several years later, the dispute surrounding these listing plans took a bizarre turn. CEO Seol began making claims that were completely at odds with his statements at the shareholder meetings—namely, that “Cash Cow was not in a position to go public, yet some shareholders are committing fraud”—which sparked internal strife among the shareholders. Former executives and shareholders who had filed criminal complaints against CEO Seol and CashCow on allegations of breach of trust and embezzlement found themselves under police investigation for fraud—accused of selling shares by misrepresenting the company as an IPO candidate when, in fact, no such plans existed.

“Listing Plans Remain Unchanged”… Cash Cow’s Listing Roadmap Presented at the Shareholders’ Meeting

According to the transcript of Cash Cow’s 2019 shareholders’ meeting obtained by Edaily on the 23rd, CEO Seol personally mentioned the IPO plan while explaining the company’s current status regarding investment attraction. He stated that the company had secured 2 billion won of the 4 billion won target set for the previous year and that the remaining investment was in progress, while also explaining to shareholders the participation of external investors such as BSG Partners.

CEO Seol went on to say, “We are currently planning for an IPO in 2021.” Regarding the method of going public, he presented not only an independent listing but also a merger with BSG Partners. He added that combining BSG’s scale with Cash Cow’s growth potential “could result in a very favorable outcome.”

When a shareholder requested a more detailed explanation of the plan, CEO Seol replied, “Plans are subject to change and revision.” However, he emphasized that BSG’s actual investment itself was a concrete “action” demonstrating the specificity of the listing and merger plans.

The presentation of a concrete IPO roadmap continued into 2021. At the annual shareholders’ meeting that year, when a shareholder asked about the status of the IPO, referring to “what was mentioned and promised here two years ago,” CEO Seol explained that they were continuing to discuss a plan to merge with BSG Partners and ISTN—which had newly joined as an investor in 2020—and then go public. His point was that while an independent IPO was possible, going public through a merger with a strategic investor with a large revenue base could be a faster route. CEO Seol stated at the time, “Discussions regarding an IPO through a merger are proceeding smoothly as planned.”

It has been confirmed that the listing plan for BSG Partners, which CEO Seol mentioned at the shareholders’ meeting at the time, subsequently progressed to the actual implementation stage. In 2023, BSG Partners pursued a KOSDAQ listing through a merger with Hana Financial SPAC No. 22, and the post-merger market capitalization was estimated at approximately 152.8 billion won at the time. However, the deal ultimately fell through following the withdrawal of the preliminary review for the merger and listing.

CEO Suddenly Changes His Tune: “We Were Never Pursuing an IPO”… Rifts Among Cash Cow Shareholders

The problem is that the promise to list Cash Cow—which had been made on multiple occasions—was not kept. Instead of pursuing an IPO, CEO Seol pushed to sell the operating rights of Cash Cow’s core business to ISTN (now Blueard), one of Cash Cow’s existing investors. Despite having personally mentioned the IPO plan on multiple occasions, CEO Seol changed his stance. He began claiming to some Cash Cow shareholders, “There was never an IPO plan; the former management and some shareholders deceived us in order to sell their shares.”

As the IPO failed to materialize, internal strife broke out among Cash Cow’s shareholders. Some investors who had previously purchased unlisted shares of E&B Soft and Cash Cow through private transactions began to raise concerns. They alleged that certain existing shareholders and the former management had inflated the company’s value by leading them to believe Cash Cow would go public soon, and then sold the unlisted shares at inflated prices.

Ultimately, in July of last year, eight shareholders—who had believed CEO Seol’s assertion that “there were no plans for an IPO and the company was not in a position to go public”—filed a criminal complaint against Mr. A, a former CashCow executive, and shareholder Mr. B, among others, on charges of selling shares under the pretext of an IPO. The Daegu Metropolitan Police Agency is currently investigating this case.

However, Mr. A and Mr. B were among those who had raised issues regarding “embezzlement, breach of trust, and tax evasion” that came to light during Cash Cow’s management.

In a phone call with E-Daily, Shareholder B stated, “They are sowing discord among shareholders because we are trying to expose the company’s criminal acts. Cash Cow shareholders have all the evidence showing that CEO Seol personally announced specific IPO plans at the 2019 and 2021 shareholders’ meetings,” he said, adding, “Although some shareholders have been swayed by inducements, 50 Cash Cow shareholders are still fighting to expose the fraud allegations.”

CEO Seol Claims ‘Listing Was Impossible’... “An IPO Is a Typical Vision for the Future of a Startup”

When asked for his position on the “IPO fraud” controversy, CEO Seol offered an explanation that differed somewhat from the remarks he had made at past shareholders’ meetings.

In a phone call with E-Daily, CEO Seol explained, “Don’t all startups have plans for an IPO?” adding, “An IPO is the typical vision for the future.” While he did not deny that CashCow had previously aimed for an IPO, his point was that this should not be interpreted as a concrete promise of a listing.

Rather, CEO Seol’s side maintains that the real issue lies with certain existing shareholders who sold unlisted shares at inflated prices by portraying the listing as imminent. He also argued that those involved in the “IPO-related fraud” had unfairly pinned allegations of tax evasion and embezzlement on CashCow.

CEO Seol claimed, “They persuaded people with lies that an IPO was imminent in order to sell shares at inflated prices, and that is why I am being sued by (some) shareholders.”

Related Article☞ Through its ongoing series *Tracking Allegations of Accounting Manipulation and Chain Fraud: The Trap of Fake Ledgers*, Edaily is covering allegations that the dispute involving Cash Cow extends to As We Make.