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Kakao Games starts 2-day IPO subscription

All News 09:39 September 01, 2020

SEOUL, Sept. 1 (Yonhap) -- South Korean gaming company Kakao Games Corp. began a two-day public subscription on Tuesday for its initial public offering (IPO), probably the biggest second-half share sale on the local market.

The game affiliate of Kakao Corp., which operates the country's most-used mobile messenger KakaoTalk, has allowed general investors to subscribe to 3.2 million shares, or 20 percent of its 16 million new common shares to be sold under the planned IPO.

Investors are required to post 50 percent of the value of shares they want to buy as a deposit.

Analysts expected the subscription rate for Kakao Games' offer to exceed that of an IPO by SK Biopharmaceuticals Co., which sparked a subscription craze among retail investors.

Potential investors wait at a brokerage office in Seoul on Aug. 31, 2020, to consult about the public subscription of shares to be sold by Kakao Games Corp. in an initial public offering. (Yonhap)

SK Biopharmaceuticals' shares were 323 times oversubscribed, attracting the largest-ever 31 trillion won (US$26.1 billion) in subscription deposits.

Late last month, Kakao Games carried out a demand forecast that found the portion of shares offered to public investors would be 1,479 times oversubscribed.

Kakao Games plans to sell the new shares at a price range between 20,000 won ($16.70) and 24,000 won as part of its efforts to become a leading global game producer.

Kakao Games hopes to raise between 320 billion won and 384 billion won via the IPO, with the proceeds to be used in developing a lineup of new games.

Founded in April 2016, Kakao Games broadened its scope not only in South Korea but across Asia with the help of KakaoTalk. As of end-June, Kakao Corp. owned the largest 58.96 percent stake in Kakao Games.

Kakao Games currently has over 45 million monthly active users, with mobile titles such as Black Desert Online and Lord of Dice. The company also published "PlayerUnknown's Battlegrounds" in the country.

In 2019, Kakao Games' sales and operating profit came to 391 billion won and 35 billion won, respectively. In the first half of this year, its operating profit reached 28.7 billion won, up 63.7 percent from a year earlier.

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