Kakao Page and Kakao M merge. It is to leap into a global entertainment company by combining IP assets and platforms.
Kakao Page (CEO Jinsoo Lee) and Kakao M (CEO Seongsu Kim) announced that they had decided to merge the two companies by holding their respective board meetings on the 25th. The merger ratio is 1 to 1.31 for Kakao Page and Kakao M, and 1.31 common shares of Kakao Page are allocated for each common share of Kakao M. The merger ratio, which indicates the value per share, reflects the corporate value of both companies and the number of shares issued, and the corporate values of Kakao Page and Kakao M were set at 1:0.6.
The name of the newly merged corporation is’Kakao Entertainment’, and the two companies plan to complete the merger on March 1 after holding a general shareholders’ meeting on the 26th and final approval.
This is the first large-scale merger between Kakao subsidiaries, each of which amounts to hundreds of billions of won in sales. When Kakao Page and Kakao M are combined, annual sales will be expected to reach KRW 1 trillion. This merger is a strategic decision to preoccupy a competitive advantage in the global entertainment industry, which is undergoing fierce battles, such as IT and distribution conglomerates challenging themselves as emerging powerhouses in content. Kakao Page and Kakao M plan to accelerate their global market penetration through the merger between the two companies.
The merger between Kakao Page and Kakao M is meaningful in that it creates strong synergy based on the IP business capabilities and platform network accumulated by both companies and secures global business competitiveness.
Kakao Page, which has established’Source Story IP Value Chain’ and’Global Story IP Platform Network’, and Kakao M, which has created a’contents business value chain’ such as music, drama, movies, digital, and performances, are combined. It has completed a business portfolio and value chain that can dominate in the global market. As a result of the merger of the two companies, there are only 50 persons/affiliates connected, and as well as establishing a strong network with partners in the entertainment and contents industry, from CP (Contents Provider) to secure original story IP, artists such as singers and actors It has secured a value chain covering all fields of entertainment and all genres, from music, drama, film, and performance planning and production.
Based on this, the company aims to continue to pursue bold investments and strategic alliances, and to grow into a leading company with differentiated competitiveness in the global entertainment industry.
Based on the IP business know-how and capabilities accumulated by both companies, the new merged corporation will expand content IP and diversify business across all entertainment fields. While focusing on the planning and production of powerful super IP targeting the global market, various synergies will be reviewed to secure differentiated content competitiveness.
The platform network that Kakao Page is building at home and abroad and Kakao M’s music and video content will be organically combined to further strengthen the existing platform and content business competitiveness. Content planning and production capabilities centered on top creators and Kakao Page’s domestic and overseas platforms optimized for content distribution are added, and it is expected that new and original contents will be introduced. Based on the synergy between the two companies, the pace of global business promotion is also expected to accelerate.
In addition, the synergy between Kakao M CEO Kim Seong-soo and Kakao Page Lee Jin-soo is also raising expectations. CEO Kim Seong-soo, who has led the innovation and globalization of Korea’s content business structure, and Lee Jin-soo, who has been leading the mobile content industry by leading the innovation of the webtoon and web novel industry that did not exist in Korea, led a new merged corporation based on their expertise in the entertainment industry. It plans to make evolution and innovation.
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Kakao Page said, “In order to gain competitiveness in the ultra-competitive global entertainment market, we decided to merge Kakao Page and Kakao M. We will lead a new entertainment industry through the combination of the business know-how and capabilities of the two companies and the value chain.”
Kakao M said, “By combining content and digital platform, we will secure differentiated competitiveness and accelerate the innovation of content business to grow into a global entertainment company.”