Nexus will acquire management control of the domestic app market ONE store for 60 billion won. The plan is to acquire ONE store and leap to a "game hub," but with operating losses continuing, the market is raising concerns about financial burdens as the company embarks on an aggressive bet larger than its equity.
After the market closed on the 18th, Nexus disclosed that it acquired 20,247,990 shares (89.03%) of ONE store for 62.62703 billion won. The sellers are SK Square (45.78%), Naver (24.06%), Steel Number One First (17.02%), and Krafton (2.17%). The scheduled transfer date is the 29th.
The acquisition of ONE store aims to create business synergies and secure future growth engines. ONE store is an app store where smartphone users can buy and use apps, and Nexus plans to evolve ONE store into a game hub by leveraging ONE store's business base, partnerships, and ecosystem. To that end, it plans to implant web3 features in ONE store, including a virtual asset wallet, a stablecoin, and a decentralized exchange (DEX).
The market is paying attention to the size of Nexus' investment. The acquisition price is about 85% of Nexus' total assets and 164% relative to its equity. In particular, ONE store's total equity is about 99.7 billion won, more than three times Nexus' roughly 30 billion won. Given that loss-making Nexus is taking in a platform company of greater scale, some interpret this as an aggressive bet.
To acquire ONE store, Nexus will issue new shares for consideration (36.4 billion won) and convertible bonds (21.2 billion won). Notably, the recipients of the paid-in capital increase are SK Square, Naver, and Krafton, which sold ONE store. The transaction effectively takes the form of an "equity swap," in which they hand over ONE store shares and receive Nexus shares. It is interpreted that Nexus will take management control of ONE store while maintaining cooperative relationships.
However, the market also raises concerns about whether synergies between Nexus and ONE store can translate into actual results. This is because Nexus, which has been posting losses in its core business since last year, is acquiring another loss-making platform company.
In particular, amid expectations that ONE store would grow into a leading domestic app market platform, valuations of 1 trillion won or more were once discussed for its initial public offering (IPO). However, it failed to break through the app market structure dominated by Google and Apple and ultimately withdrew its IPO process.
Some also note that if it fails to improve results through synergies with ONE store, only the burden of shareholder value dilution from large-scale fundraising may remain. The new shares to be issued in this paid-in capital increase total 17.17 million, about 27% of the total shares outstanding before the increase (64.11 million). Following news of the ONE store acquisition, Nexus shares are plunging 29% today.