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Nexon stocks tumble after reports deal failed

June 22,2019
A series of media reports saying the sale of gaming giant Nexon had fallen through pushed down the stocks of company and its affiliates on Friday.

Multiple media outlets reported late Thursday that Kakao, one of the bidders, had failed to reach an agreement with Nexon due to a disagreement over the price.

Nexon is attempting to sell a 98.64 percent stake of NXC, which owns 47.98 percent of Nexon, in a deal that could fetch up to 15 trillion won ($12.9 billion).

Shares of Nexon, which is listed on the Tokyo Stock Exchange, tumbled 2.95 percent to close at 1,580 yen ($14.71) on Friday.

Nexon GT, a Kosdaq-listed gaming software unit, lost 6.25 percent to close at 12,000 won while shares of Nat Games, a mobile game developer held by Nexon, also plunged 4.73 percent to close at 7,650 won.

In the preliminary bidding that closed last month, three local companies and two international companies were seeking to acquire Nexon: gaming company Netmarble, Kakao, private equity firm MBK Partners, New York-based KKR & Co. and Boston-based Bain Capital.

In April, NXC Chairman Kim Jung-ju reportedly made a pitch to Disney, but the U.S. company had no interest in making a deal.

Kim controls 98.64 percent of the company directly and through related parties.

He holds 67.49 percent, his wife 29.43 percent and Wise Kids, a software company owned by Kim, 1.72 percent.

Other reports said that U.S. tech giants Amazon and Comcast were interested, but they also didn’t appear in the preliminary bidding.

With the departure of some of the largest potential buyers, Kakao and Netmarble are seen as the most likely bidders at this point.

But analysts say that they are probably too small to make the purchase, raising the possibility for a consortium of some kind.

The Korean media outlet said that Nexon will likely reconsider the sale, although Nexon declined to comment.

BY PARK EUN-JEE [park.eunjee@joongang.co.kr]