Netmarble Neo puts off IPO until it is ready to roll out new title

“Second Country: Cross Worlds”

Netmarble Neo, the mobile game developing unit under South Korean gaming giant Netmarble Corp., has become latest among Korean IPO candidates to put off their offering plans amid poor lackluster market conditions as well as its poor performance.

According to the Korea Exchange on Thursday, Netmarble Neo voluntarily withdrew its Kosdaq debut plan four months after it filed an application for a preliminary review for its initial public offering (IPO) on June 25.

Netmarble Neo was spun off from Netmarble as an independent game developing subsidiary in 2012. It was originally named Turnon Games but was rebranded as Netmarble Neo after merging with ReBorn Games and Nurien in 2015.

Netmarble is its biggest shareholder with an 80.3 percent stake as of the third quarter of 2020, and its CEO Kwan Young-sik owns the second largest 2.9 percent stake.

Currently, the company is in charge of mobile title development for Netmarble, contributing large to the parent’s strong earnings growth with hit labels such as “Lineage 2: Revolution” and “The King of Fighters Allstar.”

In the first six months of the year, Netmarble Neo had been a disappointment, delivering an operating profit of 17.3 billion won ($14.6 million), off 42.7 percent from a year earlier, with sales down 12.8 percent to 44.2 billion won. Its global launch of its new title “Second Country: Cross Worlds” created based on the popular Japanese RPG “Ni no Kuni” has been postponed, dampening its appeal to investors.

Netmarble Neo shares closed 7.62 percent lower at 20,000 won on the country’s over-the-counter stock market called K-OTC on Thursday, bringing down the total market cap to 1.28 trillion won, after it announced the setback.

The company will reschedule debut plan later after the global launch of the new title.

“We’ve decided to re-attempt market debut when we’ll be able to receive a proper valuation and maximize the shareholders’ value,” said a company official.

Kospi-listed parent Netmarble shares fell 2.82 percent to 120,500 won in Seoul trading at 10:25 a.m. Friday.

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