Disney is Reportedly Set to Put Out $13,2B for South Korea’s Largest Game Developer Nexon

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Photo: Nexon America / Twitter

Disney was offered a controlling stake in NXC, the parent company of South Korean video game publisher Nexon, which specializes in online games for PC and mobile.

Nexon, being the biggest game developer in South Korea is also the world’s second-largest online games market. NXC owns two major cryptocurrency exchanges: Bitstamp, based in Luxembourg, and Southkorean Korbit.

This is pretty interesting because a lot of big companies were showing the interest in Nexon.

Among them were Amazon, Comcast, Electronic Arts, and Tencent.

According to Reuters, Tencent was the whole time seen as the key to any deal since it owns the exclusive China license for Dungeon Fighter (DNF), Nexon’s most successful game. However now, it seems that famous “Mouse” company could mess this deal.

According to a report from the Korea Herald, the company’s CEO Kim Jung-ju has personally approached a high-ranking Disney executive to sell his and his wife’s majority stake in the company, which is 98.64 percent, for a cool $13.2 billion.

If we look back 4 years ago, there is no wonder Jung-ju gave such an offer. He was referring to the common practice of effectively requiring players to make in-game purchases and was reportedly saying:

“What I envy the most about Disney is that they do not force money out of kids … (consumers) gladly pay Disney. Nexon has a long way to go. Some people hate Nexon to death.”

At this time, Nexon is one of the 12 biggest and most lucrative games-makers on the planet. Last year they reported earnings of $2.25 billion thanks to its wide array of monetized mobile and PC games. Disney would, of course, have Nexon run as it has, and not meddle with the Asian corporations’ business model – if anything it’d just enjoy a steady stream of revenues from mobile games and maybe use it as a wheelhouse for Marvel games.

Acquiring Bitstamp Showed Disney’s Pretensions of Crypto

Nexon currently owns 65% of crypto exchange Korbit, therefore NXC does and therefore Disney will if this deal goes through. Just for a reminder, NXC acquired Bitstamp in 2018 through one of its subsidiaries, NXMH, which is a Belgian-based investment group.

According to Bitstamp’s statement, the main goal of the deal was:

“A combination of the quality of the buyer, the quality of the offer and the fact that the industry is at a point where consolidation makes sense”.

Bitstamp is not only the longest running Bitcoin exchange, founded in 2011, but also one of the larger ones with the daily volume on the exchange of around $56.7 billion. It is included in the 10 select exchanges that Messari uses in their “Real 10 Volumes” index.

NXMH investment manager Hendrik Ghys said:

“Bitstamp is one of the oldest and most-respected cryptocurrency exchanges and we see positive growth potential as the industry continues to evolve … We acquired Bitstamp because we see it as a strategic, long-term investment.”

Even though some analysts think it’s pretty unlikely that Disney is interested in Bitstamp and Korbit, it’s not impossible that the company retains both should the acquisition proceed.

If Disney proceeds in their idea to acquire NXC, it will be a small deal compared with its acquisition of 21st Century Fox Inc. for $71.3 billion in March. Just for a reminder, each share of Twenty-First Century Fox were exchanged for $51.572626 in cash, or 0.4517 shares of TWDC Holdco, the holding company that will own both Disney and 21CF.

Founded in 1994, Nexon is now the biggest game developer and publisher by revenue in South Korea, the world’s second-biggest online games market.

51-year-old Kim said last year he did not plan to leave his company to his children, and earlier this year he hired investment banks Deutsche Bank and Morgan Stanley to explore a sale of his NXC stake, sources said.

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