The planned sale of the parent company of South Korea’s biggest online gaming firm Nexon Co. has been canceled. NXC Corp. chairman Kim Jung-ju could not narrow the valuation gap with domestic investors after failing to find a foreign buyer. Kim has sought to sell off the 98.64 percent stake in NXC Corp. held by himself, his wife and others with close ties with him. NXC Corp. owns 47.98 percent of Nexon Co., which is listed on the Tokyo Stock Exchange.
Kim had engaged in last-minute negotiations with Kakao Corp., the nation's dominant mobile messenger operator, but the two parties had failed to reach an agreement as Kakao offered a lower price than Kim wanted. Accordingly, Kim has decided to cancel the stake sale.
Netmrble Corp. also wanted to purchase Kim’s stake, but Kim questioned the mobile game developer’s financing ability. Kim’s talks with entertainment giant The Walt Disney has also broken down. Banks working on the deal, including UBS Group AG and Deutsche Bank AG, are planning to inform potential buyers of Kim’s decision to halt the sale process.
Some analysts raised the possibility of failure even before the bidding process began due to a very high price tag. The sale price was estimated at up to 15 trillion won (US$12.97 billion).
NXC had drawn binding bids from multiple financial investors, such as global private equity firms including Kohlberg Kravis Roberts & Co. LP (KKR), Bain Capital LP, and South Korea’s largest private equity fund MBK Partners Ltd., as well as its domestic rivals Kakao and Netmarble by the twice-extended deadline of May 24.