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THE INVESTOR
February 16, 2019
Big Reunion

Stocks & Bonds

Netmarble shares soar as it inches closer to US$9b Nexon deal

  • PUBLISHED :February 08, 2019 - 13:15
  • UPDATED :February 10, 2019 - 13:53
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Shares of Netmarble Games soared as Korea’s No. 2 game developer steps closer to taking over Nexon, in what would constitute a megadeal for the global gaming industry.

As of around 1 p.m., stock prices of the KOSPI-listed Netmarble had risen 9.6 percent from the previous day’s close. Its market cap came to 10.24 trillion won (US$9.11 billion), 29th-largest on the local main bourse.

Related:
Netmarble joins race for acquiring Nexon
Kakao mulls acquiring Nexon
Tencent and Nexon, an unlikely match

Earlier in the morning, industry sources revealed Netmarble has teamed up with Chinese gaming giant Tencent Holdings and private equity fund MBK Partners to obtain NXC, the holding company of Nexon valued at US$9 billion.

Netmarble and Tencent are expected to join the preliminary bid scheduled for Feb. 21 as strategic partners to exercise ownership. MBK Partners, Korea’s largest private equity firm with some US$15 billion in assets under management, will participate in the consortium as a financial investor. Further details concerning the consortium have yet to be made public.

Tencent is the third-largest shareholder of Netmarble, owning a stake of 17.6 percent. Tencent also has distribution rights in China for “Dungeon Fighter Online,” developed by NXC’s indirect subsidiary Neople.

Other potential bidders include internet giant Kakao, Carlyle Group, KKR & Co., TPG Capital, Bain Capital and Silver Lake Partners. Kakao, in which Tencent has a 6.7 percent stake, has not unveiled its plans for forming a consortium.

Up to 98.64 percent of the privately held NXC -- owned by Nexon Chairman Kim Jung-ju and his family -- has been put up for sale. Nexon is devoted mostly to gaming, but also has stakes in stroller maker Stokke and cryptocurrency exchanges Bitstamp and Korbit.

The bid is being managed by Deutsche Bank Securities in New York and Morgan Stanley’s Menlo Park office. 

Other Nexon subsidiaries affected by the latest reports were Nexon GT, an indirect subsidiary of NXC whose stock price had jumped 5.5 percent as of 1 p.m., and NAT Games, which was 2.7 percent higher in early-afternoon trade.

By Son Ji-hyoung (consnow@heraldcorp.com)

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