₩300B Deal to Fund Global Expansion, Kakao to Retain No. 2 Stake
Kakao Games announced Wednesday that a fund backed by Japan’s LY Corporation is set to become its largest shareholder, signaling a significant ownership shift aimed at accelerating its global expansion strategy.
The company revealed that LAAA Investment—a private equity fund established by LY Corporation, the Japanese tech giant formed by the merger of Line and Yahoo Japan in 2023—will acquire a portion of Kakao’s stake. Previously, Kakao held a 37.6% stake, making it the largest shareholder. The exact size of the stake sale remains undisclosed.
In addition to acquiring existing shares, LAAA Investment participated in a ₩240 billion (approximately $161 million) third-party allotment capital increase and subscribed to ₩60 billion worth of convertible bonds issued by Kakao Games.
Upon completion of the transaction in May, LAAA Investment will assume the position of largest shareholder in Kakao Games. Kakao will retain a significant stake, becoming the second-largest shareholder and maintaining its strategic partnership with the game developer.
Kakao Games anticipates that this agreement will bolster its financial stability and long-term growth prospects. The transaction secures a total of ₩300 billion to enhance its global competitiveness and expand its overseas operations.
Kakao intends to reinvest a portion of the proceeds from the share sale back into Kakao Games, indicating continued support for the company despite relinquishing controlling ownership.
According to Kakao Games, this ownership restructuring is designed to improve execution in global markets and unlock new collaborative opportunities. The company expects to expand synergies in Japan and other key regions by leveraging its new controlling shareholder.
Kakao also stated that the agreement guarantees job security and the continuation of existing employment conditions at Kakao Games, thereby ensuring organizational stability and continuity.
“This strategic investment and ownership restructuring mark an important turning point in enhancing Kakao Games’ global competitiveness and building a sustainable growth foundation,” a company official stated. “We aim to pursue new growth opportunities in global markets through cooperation with Kakao and LY Corp.”
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