This article was published on the ChosunBiz MoneyMove site at 5:31 p.m. on Dec. 11, 2025.
Global private equity firm Anchor Equity Partners (hereinafter Anchor) sued Line Games to return an investment of about 200 billion won but lost. The court did not recognize the put option (the right to sell shares at a set price) that Anchor claimed. Anchor is expected to appeal the ruling.
On Dec. 11, according to the investment banking industry and legal sources, the Seoul Central District Court ruled for the defendant in the first trial of the lawsuit Anchor filed against Line Games seeking payment for shares. Victorious Line Games was represented by law firm Lee & Ko, and Anchor was represented by law firm BAE, KIM & LEE LLC.
Line Games was founded in 2017 as a wholly owned company established by LINE Corporation. It is now majority owned by Z Intermediate Global, a subsidiary of Line Yahoo (a joint venture between Naver and SoftBank), which holds a 35.66% stake. In other words, the ownership structure is Naver·SoftBank → Line Yahoo → Z Intermediate Global → Line Games.
Anchor is the second-largest shareholder of Line Games with a 21.42% equity stake. It invested 125 billion won in 2018.
Afterward, Line Games selected Samsung Securities as its lead manager in 2022 and began to push forward with an initial public offering, but persistent losses disrupted its listing plans. Line Games had an operating loss of 39.4 billion won in 2023 and an operating loss of 16.1 billion won last year.
Meanwhile, Anchor's exit (return of investment) became remote, and last January Anchor filed a lawsuit against Line Games seeking payment for shares. Anchor argued that Line Games breached the contract and said it would exercise the put option to recover its principal investment and interest.
Anchor demanded return of a total of 223.5 billion won, adding interest with a penalty to the principal investment of 125 billion won. That is estimated to apply an internal rate of return of about 10%.
The "breach of contract" Anchor alleged involved a violation of a noncompete clause. Anchor claimed that the game released and serviced by Line Games and games serviced by Line Games' affiliates were similar enough to be competitive, and that this harmed Anchor as a shareholder of Line Games.
Line Games countered that it was difficult to see a competitive relationship between its own games and those of its affiliates. Because the titles are casual games, not core games (core games are complex systems requiring high skill while casual games have intuitive rules and low entry barriers), Line Games argued that its affiliates' competing titles did not harm Line Games.
In the end, the first trial court sided with Line Games. The court found that Line Games had not breached the contract and that the conditions for Anchor to claim the put option were not met.
Through this ruling, Line Games was able to protect more than 200 billion won in investments, but because Anchor is very likely to appeal, the two companies are expected to face an extended battle in the second trial.