SEOUL, Jun. 2 (Korea Bizwire) — Kakao Corp., Netmarble Corp., and three private equity firms submitted final bids for the parent of South Korean gaming firm Nexon, in possibly one of the biggest gaming deals worldwide, financial sources said Sunday.
In an auction that closed on May 31, mobile messaging app Kakao, Korea’s No. 2 game company Netmarble and private equity firms KKR & Co., Bain Capital and MBK Partners submitted final bids to acquire a 98.64 percent stake in Nexon’s holding company, NXC Corp., an investment bank official familiar with the deal told Yonhap News Agency.
The controlling stake up for sale is held by Nexon founder and chairman Kim Jung-ju and his wife.
Officials at the five bidders were not available for comment.
The acquisition price could reportedly fetch up to 13 trillion won (US$11 billion). Given the high price tag, financial sources expect bidders will form a consortium to finance the deal.
Chinese gaming giant Tencent, widely expected to join the bid, didn’t submit a final bid, the official said. Tencent owns a 17.7 percent stake in Netmarble and a 6.7 percent stake in Kakao.
NXC is the largest shareholder of Nexon with a 47.98 percent stake estimated to be worth 6 to 7 trillion won.
Nexon, listed on the Tokyo stock exchange, closed at 1,617 yen ($14.9) on Friday, down 1.22 percent from the previous session’s close, and its market capitalization stood at 1.45 trillion yen.
Nexon has a number of popular online game titles in its portfolio, including “MapleStory,” “Dungeon Fighter” and “Mabinogi,” along with a number of mobile games through its subsidiaries.
Nexon posted sales of $2.3 billion in 2018, up 8 percent from a year earlier, making it the world’s 12th largest gaming company by sales.
The stake sales, which have faced several delays, come at a time when local companies have complained about tough regulations on the nation’s gaming industry that restrict access for teenagers after midnight and put caps on monthly in-game spending.
The World Health Organization’s recent move to officially recognize “gaming addiction” as a mental health disorder has clouded the long-term outlook for growth among game companies.