South Korean firm Nexon’s parent said to delay bidding for stake sale

FILE PHOTO: Logos of online gaming firm Nexon are seen at its main office building in Seoul, December 14, 2011. REUTERS/Kim Hong-Ji

The parent of top South Korean gaming firm Nexon Co Ltd has delayed the bidding process scheduled this week for its controlling stake in the company, two sources familiar with the matter told Reuters, sending its shares sharply lower.

Any postponement will raise concerns for the future of a deal that would rank as one of South Korea’s biggest, and at potentially $16 billion, the biggest gaming deal worldwide.

“How the deal is going forward is uncertain, that is hitting shares of Nexon companies that are responding a lot to news related to the sale,” said Lee Chang-young, an analyst at Yuanta Securities.

Nexon shares listed in Japan were down 5 percent as of 0437 GMT, while the broader Nikkei share average was 0.8 percent softer. Nexon affiliates Nexon GT and Nat Games both tumbled 19 percent after Reuters reported the postponement.

One of the sources said the bidding, scheduled for Wednesday, had been postponed by one week. The sources did not elaborate on the reasons for the delay and declined to be identified because the matter was confidential.

A spokeswoman for Nexon‘s holding firm, NXC Corp, declined to comment.

Billionaire Jungju Kim is selling a 98.64 percent stake held by himself and his wife in NXC, the holding company that owns 48 percent of Nexon, whose Dungeon Fighter game is a smash hit in South Korea and China.

Chinese gaming giant Tencent, South Korean tech firms Netmarble and Kakao, as well as private equity firms Bain Capital, MBK Partners and KKR submitted initial bids in February, sources told Reuters previously.

Tencent is seen as the key to any deal since it owns the exclusive China licence for Dungeon Fighter.

Neople, the Nexon unit that developed the game, generated 1.24 trillion won ($1 billion) in revenue from Tencent in 2018, up 17 percent year on year, under a publishing deal which is effective till 2025, according to Neople’s public filings.

Reuters

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In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

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  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
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