This article was published on April 10, 2025, at 5:15 p.m. on the ChosunBiz MoneyMove site.
The sale of management rights for Kakao's golf subsidiary KakaoVX is again at risk of falling through. This is because Kakao requested that the preferred negotiation partner Murex Partners submit a letter of intent (LOC) by the end of March, but Murex failed to comply.
The withdrawal of KX Group, which was trying to acquire KakaoVX in partnership with Murex, dealt a significant blow. KX Group had planned to invest 20 billion won, but it is reported that they withdrew after realizing there were funding issues surrounding KakaoVX's golf course business and that equity arrangements were not settled.
As the sale of management rights drags on, KakaoVX, which has already invested 60 billion won in the golf course, finds itself in a difficult position. With the construction deadline approaching and a lack of funds hindering progress, there is a risk that KakaoVX's entire investment could go to waste.
According to investment banking (IB) industry sources on the 10th, Murex, KakaoVX's preferred partner, failed to meet the deadline for submitting the LOC, which was set for the end of last month. The exclusive preferred negotiation period already ended at the end of August last year, but KakaoVX has continued to extend the deadline as Murex struggled to raise funds.
Murex values KakaoVX at a total corporate value of 210 billion won. Kakao Games, the parent company of KakaoVX, was planning to reinvest 30 to 40 billion won to secure 10 to 15% equity, while KX Group was to invest 20 billion won, and Dosienna Group was supposed to contribute 10 billion won. KX Group owns Shinra CC in Yeongju, Club 72 in Incheon, and Paju CC in Gyeonggi.
An IB industry official noted, 'The decisive reason for KX Group's withdrawal was that the issues surrounding the golf course currently being developed by KakaoVX have not been resolved.'
KakaoVX has been preparing to build a golf course in Giheung, Yongin since 2021. They plan to construct an 18-hole course on 1,112,514 square meters (approximately 330,000 pyeong) with a project cost of 150 billion won.
KakaoVX entered the Shin-gal CC construction project by acquiring 55% of the equity in the developer, Gaseung Development. Gaseung Development was established by the late Kim Jung-ju, founder of Nexon, and the resort operator Seungsan, who invested equally; however, the largest shareholder has since changed to KakaoVX. Currently, Gaseung Development's equity is held 55% by KakaoVX and 45% by Seungsan.
Shin-gal CC was originally scheduled to be completed by the end of 2022, but progress has been stalled. KakaoVX's financial investors (FIs) are opposed to investing money in Shin-gal CC, and delays in negotiations with the landowner have made it impossible to initiate project financing (PF).
The landowner of the Shin-gal CC golf course site is the Jeonju Choi clan. Currently, the project executor has been changed from the Choi clan to Gaseung Development. Subsequently, Seungsan, the second largest shareholder of Gaseung Development, attempted to sell its 45% equity to the developer DoubleTree, but the issue is that the landowner clan has not agreed to 100%, preventing the transfer of registration. A change in the shareholders of the developer also requires the clan's consent, according to a source familiar with the deal.
In other words, as the agreement with the clan is delayed, there is no certainty on when they will receive the PF, and KX Group, having learned of this fact belatedly, has withdrawn its 20 billion won investment.
The deadline for completing the golf course is set for July this year. KakaoVX has already borrowed 60 billion won from its parent company Kakao Games and invested it in Shin-gal CC, so they must extend the deadline to meet this obligation.
An IB industry official said, 'If even the construction of the golf course falls through, KakaoVX's corporate value in the market is bound to drop further from now.' Currently, the market estimates KakaoVX's appropriate valuation is around 150 billion won.