Krafton, maker of PUBG, online games Battlegrounds Mobile India, plans to raise $ 5 billion in IPO

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Indian Battlegrounds Mobile maker Krafton is seeking to raise up to 5.6 trillion won ($ 4.9 billion) in Seoul.

PlayerUnknown’s Battlegrounds, one of the most successful games of all time, is expected to create vast wealth when the company behind this game goes public next month.

Krafton Inc. founder Chang Byung-gyu could be worth as much as $ 3.5 billion if the prices of the company’s initial public offering were in the upper range stated in his filing for IPO, according to the Bloomberg Billionaires Index. Krafton is seeking to raise up to 5.6 trillion won ($ 4.9 billion) in Seoul in what is expected to be the largest IPO ever in South Korea. Chang will own 14% of the shares after the offer.

The list will also produce a series of other beneficiaries, from Chang’s wife to CEO Kim Chang-han and Tencent Holdings Ltd.

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This is the latest example of how the wealth landscape is changing in South Korea as self-taught tech entrepreneurs rise through the ranks of the nation’s wealthiest, who were previously dominated by people from family conglomerates with roots dating back to to decades.

“Inherited wealth is no longer the only way to get rich,” said Park Ju-gun, director of the corporate research firm Leaders Index in Seoul. This new type of wealth creation “adds to the dynamism of the South Korean economy”.

Krafton declined to comment for this story.

CEO Kim’s stake could be worth as much as $ 336 million at the high end of the range. Shares held by founder’s wife Chung Seung-hye could be valued at $ 206 million, while Tencent’s 13% stake could be worth as much as $ 3.3 billion.

Chang, 48, started his own business in 1997 while studying for a doctorate. He created an online chat community that was popular with young people, but his career was cut short when he was called up for military service.

Once that was done, he founded a search engine supplier and sold it to the predecessor of South Korea’s largest search portal, Naver Corp. Krafton, then called Bluehole Inc., in 2007.

Chang bought several game studios in 2015, including one founded by the current CEO of Krafton. Kim, a computer prodigy who won national coding competitions in the 1980s, pitched the idea of ​​creating an online battle royale game where players compete against each other to be the last person standing.

“I’ve been waiting for approval for three months,” Kim said in an interview in December. “Later I heard Chang had a hard time believing the idea because the plan was weirdly too perfect.”

Chang finally gave the go-ahead, asking Brendan Greene from Ireland to be named the game’s creative director. Greene moved to South Korea, helping to develop PUBG in about a year.

The PC and console versions of the game sold over 75 million copies in March, and the mobile version was the most downloaded game in more than 150 countries, according to a company file. About 94% of Krafton’s first quarter revenue of 461 billion won was from overseas sales.

“I didn’t expect this success,” Chang said in an interview with online media EO published in January 2018. “At first I thought it would be nice to sell 400,000 titles to get the money back. money we invested. “

In his interview in December, CEO Kim said he was determined to ensure that the company does not “remain as a successful wonder.”

Krafton went public months after Seoul-based e-commerce firm Coupang Inc. raised $ 4.6 billion in an IPO on the New York Stock Exchange, the highest yet by a company. South Korean.

Coupang’s IPO amassed a fortune of $ 6.9 billion for founder Bom Kim, a U.S. national born in South Korea, according to the Bloomberg Billionaires Index. Kim Jung-ju, who founded game developer Nexon Co., has a net worth of $ 7.6 billion, while Brian Kim, who founded social messaging app company Kakao Corp., has a net worth of $ 7.6 billion. worth $ 13.7 billion.

Chang, who is set to join them in the billionaire ranks, pledged last month to donate shares worth up to 100 billion won to Krafton employees to “thank all of them. members of the company who have contributed to Krafton’s growth, ”according to a company statement.

He is the latest in a line of self-taught tycoons in the country to cede some of their wealth. Kim and Kim Bong-jin of Kakao, founders of the food delivery app Woowa Brothers Corp., both signed Bill Gates and Warren Buffett’s Giving Pledge this year, pledging to donate most of the their fortune.

“Those entrepreneurs who started their businesses from scratch tend to be more tied to inequality issues,” Leader Index’s Park said. “They also suffered to get to where they are.

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