NCSoft to ally with Netmarble to fight Nexon

South Korea’s leading game developer NCSoft has joined hands with Netmarble Games, a market leader in mobile games, to counter a move by Nexon, its largest shareholder, to wield more influence in its management.

NCSoft, best known for its PC and mobile games such as Lineage and Bladd, said Tuesday that it has agreed with Netmarble, the No. 1 mobile game developer owned by CJ Group, to swap a large amount of their own shares as part of a new strategic partnership.

Under the swap deal, NCSoft acquired a 9.8 percent stake, or 29,214 shares worth around 380 billion won in Netmarble, while the company handed over its 1.95 million shares worth 391 billion won in return. 

“The swap deal has nothing to do with the management dispute with Nexon,” said NCSoft CEO Kim Taek-jin during a news conference at a Seoul hotel. “We have sought to expand our mobile business for years.”

But industry watchers see the surprise announcement more a strategy for NCSoft to secure a combined 18.88 percent of favorable shares amid the escalating management disputes with Nexon ― which has a 15.08 percent stake.

NCSoft plans to hold a shareholders’ meeting in March and one of the key agendas will be whether to allow shareholders more rights, including Nexon’s direct participation in the firm’s management.

And Netmarble, now the third-largest shareholder, is expected to give support to NCSoft management, including CEO Kim, to defend their managerial control.

Along with the share swaps, NCSoft and Netmarble said they agreed to develop new online and mobile games together by sharing patents. They will also expand partnership in marketing and overseas expansion.

“This strategic partnership between the nation’s No. 1 online and mobile game developers is a big leap for Korea’s game industry and its overseas expansion,” Kim said.

By Kim Young-won (wone0102@heraldcorp.com)