Kakao Entertainment Corp., a South Korean content provider, announced that it is looking into a US initial public offering (IPO). According to Kakao Entertainment, it is eyeing New York as a site for its scheduled IPO next year. The Kakao subsidiary is the most recent South Korean firm to file for an IPO after Coupang’s listing last month. Moreover, e-commerce company Coupang listed on the New York Stock Exchange (NYSE) in March, producing the most extensive listing since Uber Technologies Inc.’s IPO in 2019.
“Coupang’s listing gave me hope that Korean businesses with global potential like Kakao Entertainment can get a much better valuation than they would have before,” said Lee Jin-Soo, Kakao Entertainment’s Co-CEO. Although its primary focus is a domestic listing, Kakao Entertainment also plans to list in the NYSE. As Lee stated, the company’s IPO aims to generate a 20 trillion won ($18 billion) valuation, doubling its current value. Besides Kakao Entertainment, other domestic companies also consider IPO filings, including fintech firm Viva Republica and e-commerce operator Market Kurly.
Boosting Content Portfolio for the IPO
Kakao’s digital comic, music, and video content-creating unit also allocated a 1 trillion won ($888 billion) budget for obtaining assets. Investment banking sources shared that Kakao Entertainment is currently acquiring Tapas Media Inc., the first US webcomic platform operator. In 2012, Kim Chang-won founded Tapas Media, and since its launch, it has gained over 80,000 original works. In November 2020, Kakao Entertainment, previously known as Kakao Page, acquired a 40.4% stake in Tapas.
In preparation for its IPO, Kakao Entertainment also acquired Radish Fiction, a US-based serialized fiction and web novel mobile app. Following this acquisition, the company plans to target the North American content market and deliver webtoon content to wider audiences. Currently, Kakao Entertainment holds more than 8,500 intellectual properties, preparing to compete in international markets with its accumulated original content.
Furthermore, Kakao Entertainment already partially completed this goal, continuously growing popularity in Japan with its Piccoma manga app. Kakao Entertainment revealed that Piccoma was Japan’s top manga app in 2020, with sales reaching 414 billion won ($367 million). Analysts expect the Japanese and global online comic industry to triple within the coming years, predicting a 30% yearly increase.
Lee also announced that one of Kakao Entertainment’s goals is to build a global webtoon platform that supports many languages. Additionally, Lee said that the company had reached about 10% of that goal since it already supports over five languages.
