Chinese game firm invests $298m as consortium targets 40.25% stake and broader Mir licensing
Chinese game developer Kingnet Network is investing nearly $300 million to join the consortium set to become Wemade’s largest shareholder, turning a former legal adversary into a strategic partner for expanding the Korean game publisher’s business in China.
The move is expected to bring together the two companies — Wemade and Kingnet —that have spent years embroiled in legal disputes over Wemade’s flagship IP of The Legend of Mir, a megahit massively multiplayer online role-playing game, potentially paving the way for closer commercial ties under a new ownership structure.
According to Kingnet’s regulatory filing on the Shenzhen Stock Exchange, it plans to invest approximately $298 million in a holding company that is preparing to acquire a 40.25 percent stake in Wemade.
Kingnet said Cypress Technology HK, its wholly owned Hong Kong subsidiary, would acquire a 49 percent stake in Neosphere from Nexpulse. Cypress would then inject approximately $298 million into Neosphere through a capital increase.
Nexpulse, which currently owns all of Neosphere, would contribute at least $310.2 million and retain a 51 percent stake after the transaction. The ownership structure would therefore remain split between Nexpulse and Cypress at 51 percent and 49 percent, respectively.
Neosphere indirectly controls NeoPulse through Hong Kong-based Shengsong Investment. NeoPulse, which owns 0.92 percent of Wemade, agreed to purchase an additional 39.33 percent stake from Wemade Chairman Park Kwan-ho for about 920 billion won ($684 million) in June.
The parties will proceed with the remaining payment and regulatory approval procedures through October 30.
Wemade and Kingnet reached an agreement earlier this year to resolve their legal disputes in Korea, China and Singapore over royalty issues.
“Once the transaction is completed, the investor consortium looks to focus on expanding publishing and core IP licensing opportunities in China and other global markets as Wemade’s largest shareholder with total stake of 40.25 percent,” said Wemade and NeoPulse in a joint statement.
“The consortium also plans to establish a more strategic framework for managing potential risks, drawing on its understanding of and experience in local markets and the broader gaming industry.”
hwkan@heraldcorp.com
