Online game company to form new baseball teamAn online game company has been tabbed as the owner of a new professional baseball team.
The Korea Baseball Organization on Tuesday gave the green light to NCsoft Corp., the game developer, to begin work on founding the ninth club in the top-flight baseball league in Korea. The expansion team will be based in Changwon, South Gyeongsang, and could join the KBO as early as 2013.
The decision was reached at a board of directors meeting attended by KBO Commissioner You Young-koo and presidents from the existing eight KBO clubs. At the previous board meeting in January, the officials had approved the expansion in principle while withholding their decision on the ownership of a new team. It will be the KBO’s first expansion since 1991.
All eight KBO teams are owned and operated by private companies, most of them major conglomerates. NCsoft was one of three local companies that submitted bids to found a new team, and the KBO said it was the only one to meet the league’s criteria. The identities of the two other bidders were not disclosed.
“Representatives of the eight teams let Commissioner You make the final call,” Lee Sang-il, secretary general of the league, told reporters. “We concluded NCsoft and the city of Changwon were all qualified to join the KBO.”
During the meeting, the officials approved a new set of qualifications for an expansion team. A company wanting to start a team must either have at least 100 billion won ($90.5 million) in net profits or must have a net income to stockholders’ equity ratio of more than 10 percent. The company must also meet certain figures that determine its financial stability.
Previously, candidates for expansion only had to report a certain amount of revenues and maintain a certain number of employees.
NCsoft reported to the KBO that it posted 634.7 billion won in annual sales and 233.8 billion won in operating profits in 2009, and that it expected to reach similar figures for 2010.
“I’d like to thank the KBO for reaching a significant decision today,” said Lee Jae-sung, director of public relations at NCsoft. “We will work closely with Changwon and wrap up our process as soon as possible. We will try to transform Changwon into a baseball town.”
The KBO stipulated that an expansion team must build a stadium with at least 25,000 seats within five years of its inception. Changwon plans to renovate Masan Stadium, an existing ballpark in the city, for immediate use and construct a new ballpark.
There are still some steps left for the expansion team. Lee Sang-il, the KBO secretary general, said team representatives will further discuss league entry fees and an expansion draft at the next board meeting, scheduled for March 8.
There is usually no minimum amount for league entry fees, which are contributed to the league development fund. But the KBO this time set the bar at 5 billion won for NCsoft, on par with what the Seoul-based Nexen Heroes paid when they entered the league before the 2008 season. The Heroes, which took over the defunct Hyundai Unicorns, shelled out 12 billion won in total. But 7.4 billion won of that was paid to two other Seoul clubs, the Doosan Bears and LG Twins, for splitting the market, and the remaining 4.6 billion won was added to the league fund.
Among the existing eight teams, the Lotte Giants, based in Busan, were the sole opponent of the expansion, according to Lee Sang-il. But officials who had been vocal were quieter Tuesday. After the board meeting, Chang Byung-soo, the Giants’ president, said, “We don’t have a stance (on the decision).”
The KBO wants to have another team to set up a 10-team league, which would provide an option of separating the teams into two divisions. Kenneth Young, an American entrepreneur who owns minor league baseball teams in the United States, has expressed interest in founding a club here.