Kakao Games Makes Second Attempt at IPO After Two Years

[Asia Economy, reporter Koh Hyungkwang] Kakao Games is set to become the first Kakao affiliate to go public through an initial public offering (IPO). This marks a renewed attempt two years after withdrawing its IPO plans in 2018.

According to the financial investment industry on June 13, Kakao Games submitted a preliminary application for KOSDAQ listing to the Korea Exchange on June 11. Kakao Games had previously pursued an IPO in 2018. At that time, the company received preliminary approval for KOSDAQ listing, but voluntarily halted the IPO process due to accounting audit issues. Back then, Korea Investment & Securities was the lead underwriter, but earlier this year, Samsung Securities was added as a joint underwriter, and the company resumed its listing efforts.

Kakao Games was established in April 2016 through the merger of Engine and Daum Games. In 2017, it consolidated Kakao's gaming business units, becoming a core affiliate within the Kakao Group. Last year, the company posted sales of 391 billion KRW and operating profit of 35 billion KRW. This year, its sales are expected to exceed 400 billion KRW.

The investment banking (IB) industry estimates that Kakao Games' corporate value could reach 2 trillion KRW upon listing. In 2018, the expected corporate value was in the 1 trillion KRW range. However, over the past two years, the rapid growth of the mobile gaming market has boosted its valuation. During this period, popular games such as Tera Classic have also successfully established themselves in the market. Kakao Games currently boasts 20 million monthly active users, making it the number one mobile game platform in Korea.

Other Kakao affiliates, including Kakao Page and Kakao Bank, are also pursuing IPOs. Among these, Kakao has chosen Kakao Games as the first to go public, as the company has gained attention as a leader in the untact (contactless) industry-such as gaming and internet services-amid the impact of the COVID-19 pandemic.

This content was produced with the assistance of AI translation services.