Founder Kim struggles to find buyer due to high price
By Jun Ji-hye
Nexon founder Kim Jung-ju has been facing difficulties in selling his company due largely to the high sale price, industry sources said Friday, pointing out that a preferred bidder has not been selected since bidding ended on May 31.
This increases the likelihood that battle for control of Nexon could go back to square one and even founder unless Kim reduces the price.
Kakao, the nation's dominant mobile messenger operator, has been engaged in last-minute negotiations to take over Nexon, but the parties failed to find middle ground, according to a local newspaper.
Another games company Netmarble and three private equity funds including MBK Partners participated in the bid.
From Kim's point of view, a private equity fund might not be the right buyer because such a deal might result in large-scale restructuring.
Netmarble has been most active in seeking to acquire Nexon, with the expectation that a takeover would create synergy because it would bring various Nexon patents. But if Netmarble succeeded in acquiring Nexon, it may give Netmarble monopoly status in the game industry here, which would provoke another controversy.
Because of this, Kakao has been cited as the strongest candidate, but the high price apparently impeded the deal, industry sources said.
Kim, CEO of Nexon's holding company NXC, previously put NXC's 98.64 percent stake owned by himself, his wife and his private company, on the market.
NXC owns Nexon, which is based in Japan, and the Japanese entity controls Nexon Korea.
The acquisition price is estimated at 10 trillion won ($8.6 billion) to 15 trillion won.
Kakao reportedly holds about 2 trillion won in cash, with uncertainty having been raised about the company's ability to raise the funds.
Kim holds the key to whether or not the deal will happen ― he could wait until he finds the right party, or he could reduce the sale price to complete the deal as soon as possible.
"A process to complete the mega deal could extend over a long time because potential purchasers apparently want to prolong the process to drive down the price," said an industry source familiar with the issue.
A Nexon official refused to comment, saying only, "There is nothing we can confirm now regarding the sale of the company."
By Jun Ji-hye
Nexon founder Kim Jung-ju has been facing difficulties in selling his company due largely to the high sale price, industry sources said Friday, pointing out that a preferred bidder has not been selected since bidding ended on May 31.
This increases the likelihood that battle for control of Nexon could go back to square one and even founder unless Kim reduces the price.
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| Nexon headquarters in Pangyo, Gyeonggi Province. / Courtesy of Nexon |
Another games company Netmarble and three private equity funds including MBK Partners participated in the bid.
From Kim's point of view, a private equity fund might not be the right buyer because such a deal might result in large-scale restructuring.
Netmarble has been most active in seeking to acquire Nexon, with the expectation that a takeover would create synergy because it would bring various Nexon patents. But if Netmarble succeeded in acquiring Nexon, it may give Netmarble monopoly status in the game industry here, which would provoke another controversy.
Because of this, Kakao has been cited as the strongest candidate, but the high price apparently impeded the deal, industry sources said.
 |
| Nexon founder Kim Jung-ju. |
Kim, CEO of Nexon's holding company NXC, previously put NXC's 98.64 percent stake owned by himself, his wife and his private company, on the market.
NXC owns Nexon, which is based in Japan, and the Japanese entity controls Nexon Korea.
The acquisition price is estimated at 10 trillion won ($8.6 billion) to 15 trillion won.
Kakao reportedly holds about 2 trillion won in cash, with uncertainty having been raised about the company's ability to raise the funds.
Kim holds the key to whether or not the deal will happen ― he could wait until he finds the right party, or he could reduce the sale price to complete the deal as soon as possible.
"A process to complete the mega deal could extend over a long time because potential purchasers apparently want to prolong the process to drive down the price," said an industry source familiar with the issue.
A Nexon official refused to comment, saying only, "There is nothing we can confirm now regarding the sale of the company."
