Major gaming conglomerate Nexon prepares to acquire Bithumb

South Korean media has reported that Nexon, a multi-billion dollar conglomerate led by CEO Kim Seong-Ju, plans to acquire the country’s largest cryptocurrency exchange Bithumb.

After a troubled few months, crypto exchange Bithumb looks like it’s set on turning over a new leaf through an acquisition by one of South Korea’s top gaming firms. 

Nexon to take over at a “discounted price”

South Korean media reported on Jan. 7 that Nexon, a multi-billion dollar gaming conglomerate, has signed a memorandum of understanding, or MoU, to acquire the exchange at an evaluated price of 650 billion won ($460 million).

Nexon, led by CEO Kim Seoung-Ju, will reportedly work with one of the major shareholders in Bithumb, Vidente, to buy out the exchange and take control of the company. According to South Korean media, Nexon plans to take a 65% stake in Bithumb.

As the report notes, Bithumb’s existing shares are trading at a total value of 1 trillion won ($914 million) on the over-the-counter market, meaning that the deal, if successful, will allow Nexon to take over at a “discounted price.”

The sale of the exchange has reportedly been in the works since late August 2020, with a preliminary bidding held in September at which a number of financial and strategic investors, including domestic and foreign private equity fund managers, bid for success.

Legal issues

Yet the ongoing police investigation involving Lee Jung Hoon, chairman of board at Bithumb Korea and Bithumb Holdings, appears to have slowed down the process.

The report notes that the legal entanglement of the exchange’s current shareholders, who are also being sued for embezzlement by investors, could make it difficult for the exchange to secure the legally required registration as a crypto entity with South Korean authorities. 

Major gaming conglomerate Nixon prepares to acquire Bithumb

An acquisition and change in management could clear this regulatory obstacle. Young has commented that Nexon’s acquisition would, more generally, “improve the image around the most dominant crypto trading platform in the local market.”

Nexon expanded its influence

Nexon’s holding company, NXC, has previously invested in cryptocurrency and fintechs, including the well-known exchange Bitstamp. Given Bithumb’s prime position as South Korea’s largest crypto exchange by trading volume, Nexon’s market dominance is expected to benefit if the acquisition is successful. 

In the third quarter of 2020, the number of subscribers to Bithumb reportedly exceeded 5 million, and the company is said to have plans to expand its products and upgrade its compliance measures in the hope of securing a virtual asset business license. 

TimeBit/Source:Cointelegrap

*The article is for information purposes and market analysis only, not an article that encourages investment. You should do your own research before making any investment decisions. Crypto, Forex news updated 24/7 on our social media channels: Follow us at TimeBit and Telegram Timebit-Cryptonews.