Game maker Krafton targets up to $5 bln in S.Korea's biggest IPO (updated)

Netmarble

16/06/2021 01:32

* Krafton estimates valuation at 35 trln won
    * Listing expected in July
    * 2021 seeing many large S.Korean IPOs

 (Adds details on Tencent, list timing, valuation)
    By Joyce Lee
    SEOUL, June 16 (Reuters) - Krafton Inc, the South Korean
company behind blockbuster video game "PlayerUnknown's
Battlegrounds", said on Wednesday its IPO would raise up to 5.6
trillion won ($5 billion) at the top of an indicative range,
which would be a record for the country. 
    Tencent-backed Krafton said in a regulatory filing it
expected to offer 10 million shares, or 7 million new shares and
3 million existing shares, at an indicative range of
458,000-557,000 won per share. 
    At the top of the range, this would be South Korea's largest
listing, beating Samsung Life Insurance's  032830.KS  4.9
trillion won IPO in 2010.  urn:newsml:reuters.com:*:nL2N2NT0OP 
    The pricing is expected to be decided in the coming weeks,
with listing expected in July. 
    Krafton's online multiplayer war-fighting game PUBG has sold
25 million copies on PC and game consoles, becoming one of the
fastest-selling games since its launch in 2017. 
    Chinese gaming and social media giant Tencent  0700.HK  is
currently Krafton's second-largest shareholder with a 15.35%
stake through an investment vehicle, according to a regulatory
filing. 
    Krafton is planning to release two new games this year based
on the PUBG intellectual property (IP), including mobile game
"PUBG: New State" and "Battlegrounds Mobile India" targeting the
Indian market. 
    The company is also expanding to areas such as web-based
cartoons, movies and animation, and developing a deep learning,
AI business model targeting consumers. 
    It reported 1.67 trillion won in revenue in 2020, and its
operating profit more than doubled from the previous year to 774
billion won. 
    The company estimated its valuation at 35 trillion won, at a
price-to-earnings ratio of 45.2, which is slightly lower than
South Korean game industry peers NCSoft  036570.KS  and
Netmarble  251270.KS , according to its filing.
    Mirae Asset Securities is lead advisor for the IPO, while
Credit Suisse, NH Investment & Securities, Citigroup and JP
Morgan are also advisors. 
    South Korea is experiencing its hottest IPO market on record
with analysts expecting at least 20 trillion won to be raised in
2021, or about four times above 2020 levels.  urn:newsml:reuters.com:*:nL4N2JB0RD
    "This year is unprecedented in the concentration of huge new
listings on the KOSPI with market capitalisations that range
from trillions of won to tens of trillions of won," said Choi
Jong-kyung, analyst at Heungkuk Securities. 
 ($1 = 1,117.1400 won)

 (Reporting by Joyce Lee; Editing by Stephen Coates)
 ((jungyoon.lee@tr.com; +82 2 6936 1467;))