Naver Webtoon eyes Nasdaq listing in June

Naver Webtoon CEO Kim Jun-koo speaks with reporters in a press conference at the firm's headquarters in Seongnam, Gyeonggi Province in April 2022. (Naver Webtoon)

South Korean internet giant Naver is pushing to have its online comics operator Webtoon Entertainment go public on the US Nasdaq as early as June, according to a recent Bloomberg report.

Webtoon Entertainment is the head office for the online comics business Naver Webtoon, and has been based in Los Angeles since May 2020. The firm, with a 71.2 percent stake owned by Naver, manages the overall online comics operations and the content platform business.

While there has been talk that the online comics operator will go public in a couple of years in the US, the report said that the company has enlisted Goldman Sachs and Morgan Stanley as lead underwriters and that the IPO could happen as early as June.

The company, which has received a valuation of $3-4 billion from brokerage houses, hopes to raise as much as $500 million through the IPO.

“By using the funds raised through the IPO, Naver Webtoon needs to (foster) a foundation for long-term growth, such as expanding the range of users through marketing and securing intellectual property that can be well-received in the global market,” said analyst Chung Ho-yoon from Korea Investment & Securities.

But Chung assessed the company’s market debut will not be enough to raise the share price of Naver.

“The market value of $4 billion is not enough to lead to the price surge of Naver shares. Considering Naver’s stake in the affiliate will be watered down after the IPO, the market debut could rather work as a negative factor for Naver stocks.”

Naver Webtoon currently has 85.6 million monthly active users globally, according to an announcement made through a press conference held in the US earlier this year. The number of users in North America stood at 12.5 million as of the end of the second quarter of 2022.

Naver Webtoon posted a profit in earnings before interest, taxes, depreciation and amortization, or EBITDA, last year -- its first since its establishment six years ago. EBITDA is a metric that shows a company’s profitability from its core business operations.

Meanwhile, Naver’s crosstown rival Kakao also operates Tapas Entertainment under Kakao Entertainment for the online comics business. Kakao Entertainment, however, has pushed back its IPO plans due to legal risks associated with Kakao’s takeover of K-pop agency SM Entertainment last year.

By Im Eun-byel(silverstar@heraldcorp.com)