Kakao Games bookbuilding draws record-high demand

  • 2020-08-31

Kakao Games Corp. posted record-high demand during its bookbuilding for institutional investors on August 25 and 26, according to the company’s regulatory filing on August 31.

Bids outnumbered offers 1,479 to 1, marking the highest demand seen since bookbuilding was implemented in South Korea. The offering price will be 24,000 won ($20).

Some 1,745 institutions participated in the bookbuilding, with total demand for 16.7 billion shares. Of these: 1,366 institutions offered over 24,000 won, above the 20,000 won to 24,000 won price band; 108 institutions offered 24,000 won; and none offered below 24,000 won, although 271 did not indicate a price.

Among the total number of bids submitted, 58.6% agreed to lock-up provisions, ranging from half a month to six months. The subscription process for retail investors is set for September 1 and 2.


The game unit of Korea’s leading mobile messaging app Kakao Corp. is expected to become the country’s biggest initial public offering of the year as it aims to make its trading debut on the tech-heavy KOSDAQ in mid-September.

Korean Investors earlier reported that around 270 billion won ($227 million), 71% from the 384 billion won offering, was allocated to institutional investors, with demand exceeding a staggering 270 trillion won. For the public offering, Kakao Games plans to issue 16 million shares to both institutional and individual investors. The company’s enterprise value is projected at 1.76 trillion won based on the proposed IPO price.

Kakao Games plans to use the proceeds to carry out active M&As within the game sector and diversify its content portfolio. In addition to robust M&A activity, the company will also shore up its portfolio toward directly developed games by investing in game companies, said the company’s chief executive officer Namkoong Whon during an online conference August 26.


Kakao Games CEO Namkoong Whon speaks at the Aug 26 online conference

The company earned 27.8 billion won in net profit on revenues of 203 billion won in the first half of this year, up 264% and 8.2% year on year, respectively.

The company’s affiliates Kakao Page Corp., Kakao Commerce Corp., and Kakao Bank are also expected to prepare for listings.

By Ye-jin Jun


<Edited by Danbee Lee>