이 기사는 2021년 04월 15일 08:11 thebell 에 표출된 기사입니다.

Kakao Corp has dismissed rumors of merging Kakao Entertainment with Kakao Japan, saying such an option “is not on the table at all.”

Kakao Entertainment’s aggressive investments in foreign content businesses ignited the rumors.

The South Korean company is in the process of acquiring a controlling stake in Tapas Media, according to industry sources. It bought 2 million shares or a 10.89% stake in the U.S.-based online cartoon platform for $10.3 million last September.

Kakao Entertainment currently holds 40.4% of the company, and is estimated to need at least $28.53 million to purchase the remaining stake.

Kakao Entertainment is also aiming to acquire U.S. online fiction platform Radish. It bought some 12% of the company for 32.2 billion won ($28.8 million) last summer, and will likely need approximately 350 billion won to acquire the remaining stake given the storytelling platform’s latest valuation of 400 billion won.

In sum, at least 382.1 billion won will be needed for Kakao Entertainment to complete the acquisitions of the two platforms. However, it had 184.4 billion won in cash and cash equivalents as of the end of February. Its gross debt stood at 159.2 billion won, with short-term debt that is due within one year accounting for 127.6 billion won. This means that the company’s cash available for use is less than 60 billion won.

In contrast, Kakao Japan is in talks to raise about 750 billion won from private equity firm Anchor Equity Partners in a deal valuing it at 5 trillion won. This, combined with Kakao Entertainment’s cash needs, stoked the merger possibility.

“Both companies are operating well separately and are preparing for an initial public offering separately,” said an official at Kakao Corp.

An official at Kakao Entertainment said: “We will continue (our investments) by using cash on hand without harming our financial condition.”

The two companies have a strong business relationship. Kakao Entertainment, formerly known as Kakao Page, is a main source of content served on Kakao Japan’s comics app Piccoma. It also owns 21.6% of Kakao Japan. (Reporting by Hana Suh)