Nexon Corp., South Korea’s top game developer, has sold off its major stake in rival NCsoft Corp., industry data showed Friday, ending their awkward partnership after the team-up turned into a management dispute early this year.
Nexon became the single largest shareholder in NCsoft in 2012 by acquiring a 15 percent stake in the rival from its chief executive, Kim Taek-jin, for about 800 billion won ($709 million).
The purchase came as part of a strategic tie-up to seek a joint takeover of Electronic Arts Inc., a U.S.-based video game developer.
However, the partnership fell apart as the takeover attempt was thwarted, with Nexon’s move toward a hostile takeover of NCsoft early this year aggravating the alliance.
Nexon on Thursday disposed of its entire 3.37 million shares, now worth about 600 billion won (US$532 million) in NCsoft, through a block deal in off-hours trading, according to the Tokyo bourse.
The sale was managed by Morgan Stanley, for 180,000 won to 190,000 won per share at a 3.3 to 8.4 percent discounted value based on its Thursday closing price, it added.
NCsoft said in a regulatory filing on Friday that its CEO bought back 2 percent, or 440,000 shares, of that stake via the block trading. The repurchase raises Kim’s stake in his company to 12 percent.
Market watchers have bet on Nexon’s stake sale, since the stock ownership gives the firm little benefit.
Nexon said it has unwinded its stake in NCsoft because the investment has failed to create any synergies between the two companies, adding that the recovered money will be used to boost investor value.
The dispute between the top two game makers had reached a boiling point in February, when NCsoft joined forces with smaller local rival Netmarble to protect its management control against a possible takeover by Nexon.
It involved a 700 billion won stock-swap deal between the two game ventures, with Netmarble buying a 9 percent stake in NCsoft and vice versa, giving a shield to Kim. (Yonhap)
