KoreaTechToday - Korea's Leading Tech and Startup Media Platform
  • Topics
    • Naver
    • Kakao
    • Nexon
    • Netmarble
    • NCsoft
    • Samsung
    • Hyundai
    • SKT
    • LG
    • KT
    • Retail
    • Startup
    • Blockchain
    • government
  • Topics
    • Naver
    • Kakao
    • Nexon
    • Netmarble
    • NCsoft
    • Samsung
    • Hyundai
    • SKT
    • LG
    • KT
    • Retail
    • Startup
    • Blockchain
    • government
No Result
View All Result
KoreaTechToday - Korea's Leading Tech and Startup Media Platform
No Result
View All Result
Home Nexon

Global IBs set their eyes on the‘15 trillion Nexon Big Deal’

 1,167 total views,  2 views today

KoreaTechToday Editor by KoreaTechToday Editor
PUBLISHED: March 29, 2019 UPDATED: March 29, 2019
in Nexon
0
Global IBs set their eyes on  the‘15 trillion Nexon Big Deal’

In the run-up to acquire Korean gaming giant Nexon, known global financial companies based in Hong Kong including JP Morgan are visiting South Korea to contact local financial companies. Since the sales volume (up to 15 trillion won(US$15 billion)) is expected to exceed 7 trillion won (US$7 billion), domestic and foreign financial companies are joining forces to form a financing structure. Moreover, Nexon has five times the value of intangible assets rather than tangible assets, which limits Korean financial firms, who are accustomed to financing based on collateral, to form structures on their own.

According to M&A industries on the 17th March, it was confirmed that working-level officials from 5 to 6 global IBs including JP Morgan, Credit Swiss (CS), and BNP Paribas, which are based in Hong Kong, visited Korea and contacted commercial banks and securities companies. They are said to have discussed ways to arrange acquisition financing together with local financial companies for the sale of Nexon, which is set to be held next month.

Nexon decided to sell its parent company NXC and conducted a preliminary bid for 98.64 per cent of its stake. The company is currently conducting due diligence on the bidders. Deutsche Bank, the main bidder for the sale, will open when the due diligence is completed. It is highly likely that the main bidding will be held next month, and management companies of large private equity funds (PEF) such as MBK Partners, KKR, and Bain Capital will participate as well as strategic investors (SI) such as Kakao and Tencent.

The problem is a huge ransom, estimated at up to 15 trillion won (US$15 billion). Although it may vary depending on the structure of financing and how it is planned to be sold. IB industries estimate that amount of acquisition will reach between 7~8 trillion won. “Although it is true that it is an attractive sale since only 3 per cent of the loan rate can be raised to more than 200 billion won (US$200 million) a year, it is practically impossible to invest all of the funds in a game company that has no tangible assets as collateral,” an official from the IB industry said. “It is the reality of Korean financial companies that are hard to predict and analyze Nexon’s Future in 10 years objectively.”

At the end of 2017, the value of the NXC’s intangible assets reached 1.11 trillion won (US$1.11 billion) based on book value, while the value of land and buildings among tangible assets was only 269.8 billion won (US$269.8 million). This means it is difficult for a Korean financial company accustomed to mortgage loans to make large-scale investments.

Global IBs are also focusing on these weaknesses. Since about 70 per cent of Nexon`s sales are taking place overseas, some say that it proposed a plan to divide acquisition funds into two transits: the Korean won and the foreign currency to be managed by a local financial company and a foreign company, respectively.

Another variable is whether China’s biggest game company Tencent will participate or not. If Tencent participates in the main bidding, it can ignite once again the sales fever that has become somewhat withered. There is also a possibility that Tencent, which has a huge amount of funding, will attract Chinese-American IBs to reorganize its financing structure.

What’s your thoughts?
+1
0
+1
0
+1
0
+1
0
+1
0
+1
0
+1
0
Tags: Nexon

Related Posts

Here are the top nine mobile "massively multiplayer online role-playing games (MMORPG)" in South Korea this August 2020
Games

Top Nine Mobile MMORPG in South Korea for 2020

August 28, 2020
Second wave of COVID-19 makes IT Firms go back to remote working.
Coronavirus

Korean IT Firms Back to Remote Working in Fear of Second COVID-19 Wave

August 19, 2020
Naver, Nexon, and Watcha employ AI software to filter and block abusive comments, improving user experience in online communities.
AI

South Korean IT Firms Employ AI to Block Abusive Comments

July 1, 2020
nexon sudden attack x itaewon class
Games

Nexon Implements Subscription Model for Shooting Game “Sudden Attack”

May 6, 2020
tata-nexon-ev-ext-int
Electric vehicle

Tata Nexon EV Might be Your Next Favorite Electric SUV

February 12, 2020
Nexon Logo
Nexon

Nexon To Reorganize Amid Failing Profits

September 13, 2019
No Result
View All Result

Follow Us

FREE NEWSLETTER




PRODUCTS

Most Popular

  • 5 Best Korean to English Translation Apps

    0 shares
    Share 0 Tweet 0
  • Top South Korean Tech Products to Look Out for in 2021

    0 shares
    Share 0 Tweet 0
  • Robots to help Police Patrol in South Korea

    0 shares
    Share 0 Tweet 0
  • 5 All-Time Best Rom-Com K-Dramas to Watch

    0 shares
    Share 0 Tweet 0
  • South Korea plans Urban Air Mobility Air Taxi services by 2025

    0 shares
    Share 0 Tweet 0
  • SK On to introduce South Korea’s first LFP Battery Prototype

    0 shares
    Share 0 Tweet 0
  • South Korea to commercialize Quantum Cryptography Communications

    0 shares
    Share 0 Tweet 0
  • Top Eight Promising EdTech Startup Companies in South Korea

    0 shares
    Share 0 Tweet 0
  • Netmarble subsidiary Metaverse Entertainment’s K-Pop virtual girl band MAVE has a smashing online debut

    0 shares
    Share 0 Tweet 0
  • Nexon To Reorganize Amid Failing Profits

    0 shares
    Share 0 Tweet 0
  • About Us
  • Account Page
  • application form
  • Cookie policy
  • Default Redirect Page
  • homepage
  • Login
  • login form
  • LogOut
  • Newsletter
  • Privacy Policy
  • Register
  • Reset Password
  • Sample Page
  • Subscription Plan
  • Terms of Use
  • test
  • test
  • testpage
  • TOS Page
  • Visitor Inside User Page

Copyright © 2023 KoreaTechToday | About Us | Terms of Use |Privacy Policy |Cookie Policy| Contact : press@koreatechtoday.com |

No Result
View All Result
  • Topics
    • Naver
    • Kakao
    • Nexon
    • Netmarble
    • NCsoft
    • Samsung
    • Hyundai
    • SKT
    • LG
    • KT
    • Retail
    • Startup
    • Blockchain
    • government

Copyright © 2023 KoreaTechToday | About Us | Terms of Use |Privacy Policy |Cookie Policy| Contact : press@koreatechtoday.com |