Kakao Games, which recently celebrated its 10th anniversary, is embarking on a "second leap" based on a new management structure and major shareholder. The company is streamlining non-core businesses to focus resources on its core gaming operations while leveraging an investment fund of approximately 300 billion won to accelerate mergers, acquisitions (M&A), and the securing of new titles.
Kakao Games was established in 2016 through the merger of Engine and Daum Games. Initially starting with a channeling business leveraging its platform, it expanded into publishing by directly operating games. Subsequently, by bringing companies such as XL Games and Lionheart Studio under its umbrella as subsidiaries, it built a business structure encompassing platforms, publishing, and development. Its portfolio has also expanded to include titles such as "Odin: Valhalla Rising," "Uma Musume Pretty Derby," "Aion W," "PUBG," and "Path of Exile."
Over the past two years, the company has restructured its business model. Kakao Games successively sold its stakes in KakaoVX, Sena Technology, and Neptune, and transferred its stake in the Web3 gaming business of subsidiary Metabora to Rudikova Holdings. These moves were made to reduce non-core businesses and concentrate resources on the gaming sector.
The turning point came last June. Kakao Games welcomed LY Corporation as a strategic partner and new major shareholder. By attracting strategic investment centered on LAAA Investment, an investment vehicle funded by LINE Yahoo, the company secured approximately 300 billion won in resources.
Management has also changed. Following the appointment of Kim Tae-hwan (CEO), who possesses global strategic experience, as co-CEO, the company is accelerating M&A and investments using the newly raised funds.
Recently, Kakao Games acquired backend AI technology firm Backend X and global casual game developer Miton. The strategy is to simultaneously expand technological capabilities and its gaming portfolio to secure a stable revenue base.
Existing core intellectual properties (IPs) are expected to drive future growth. Lionheart Studio is developing "Odin Q: Valkyrie Call," a new title expanding the "Odin: Valhalla Rising" IP. Set against the backdrop of Norse mythology, it is a full 3D seamless open-world game featuring a quarter-view perspective and utilizes Unreal Engine 5. It is scheduled to be unveiled as a major anticipated title in early next year.
The "Aion" IP will also be revitalized. Kakao Games transferred the Aion IP to Alliance Studio through an asset purchase and sale agreement with XL Games. Alliance Studio is developing the MMORPG "Aion S: Strait of Freedom," while Kakao Games will handle global publishing.
The company has also recently released a new title. On the 8th, it officially launched the 2.5D MMORPG "Goblin's World." The game is characterized by its combination of 2D dot characters and 3D backgrounds, based on the IP of Naver web novel and webtoon "Muryu Su Do Jeon" (Slaying Demon Sword Legend).
A medium- to long-term lineup is also in preparation. Titles awaiting release include Ocean Drive Studio's open-world zombie survival simulator "God Save Birmingham," the open-world action RPG "Chrono Odyssey," and the collection-based action RPG "Guardian Maiden," which is being developed with Kong Studio.
Kakao Games aims to simultaneously boost profitability and growth potential by streamlining non-core assets, securing investment funds, and expanding new titles centered on core IPs. Whether the structural improvements underway, marked by its 10th anniversary, will translate into an actual turnaround in performance will be a key point of observation going forward.
in TECH
