Tving out to raise $252 mn amid spiked valuation from popularity of Korean contents

(Updated with additional information)

South Korea’s video streaming service Tving is set to easily draw new funding to boost its corporate valuation to around $1.5 billion amid increased attention on Korean original contents after the mega-hit of “Squid Game” through Netflix backing and stream servicing.

Tving has picked Nomura Securities to lead-manage sales of 300 billion won ($252.2 million) in new shares and is in talks with multiple private equity funds at home and abroad, according to sources from the investment banking industry on Wednesday. Some tech companies are also reported to showing interest. Tving’s corporate value could reach 1.5 trillion won to 2 trillion won after the stake sale.

Tving was launched in 2010 under CJ ENM and was separated from the parent as an independent entity in October 2020. Naver, the country’s largest platform company, took over a 15.4 percent stake for 40 billion won in June to become the second largest shareholder after CJ ENM with 70.5 percent stake. TV network JTBC is the third with 14.1 percent.

At the time of its stake sale to Naver, the company’s valuation had been at around 300 billion won.

Its worth could more quadruple on the back of exploding global popularity of Korean shows. Netflix’s original Korean series “Squid Game” ranked top in 83 countries. One of the cast members Jung Ho-yeon has gained 14 million Instagram followers from just 400,000 after the show was released, the most for Korean actresses.

Tving has also been showing rapid growth. The company said the number of paid subscribers increased 63 percent from September 2020 to April this year. It has been attracting viewers of all ages, with the number of subscribers in their 30s up 22 percent over the period, 40s 28 percent 50s 46 percent and 60 or more 33 percent. It aims to achieve 8 million subscribers by 2023.

A market analyst well versed in the OTT market said content matters more than platform for a video streamer, so Tving must market its ability to create many original Korean shows that can sell well in the global market to raise the fund.

The world’s largest OTT service platform Netflix has been buoyed by the rising popularity of its original titles including “Squid Game.” Netflix’s market capitalization reached an all-time high at around $280.9 billion as of Tuesday (local time).

[ㄏ Maeil Business Newspaper & mk.co.kr, All rights reserved]