Kakao Japan sells 7.8 percent stake to private equity group

A group of investors led by Hong Kong-based private equity fund Anchor Equity Partners acquired a 7.8 percent stake in Kakao Japan for 600 billion won ($530.2 million), as the company seeks to further develop webtoons and take them mainstream.

Following the investment, Kakao Japan is valued at 8.8 trillion won, according to the company.

The investors will form a private equity fund, which will be called Ryan & Friends, and purchase a total of 67,930 new shares for 560 billion won, according to the company on Thursday. Another 40 billion won will be used to buy existing shares.

With the purchase, Ryan & Friends will be the third largest shareholder of Kakao Japan, with a 7.8 percent stake. Kakao will own 72.9 percent and Kakao Entertainment 18.2 percent.

Kakao Japan entered the Japanese comic market with Piccoma in 2016. Since July last year, Piccoma has been No.1 by sales among Japan’s comic apps. Japan is the largest comic market in the world, valued at about 6 trillion won, more than four times the size of those in the United States and China.

The proceeds will be used to "make investments into the Piccoma platform and nurture creators to develop the webtoon genre into mainstream content on the global stage," according to Kim Jae-yong, CEO of Kakao Japan.

Kakao Japan has also been concentrating on producing its original webtoons. The company established its own studios – Sherpa Studio in Japan and Studio1pic in Seoul — aimed at fostering talented artists in each country and strengthen the output.

“Using the resources we have attracted, we aim to lead the market with more competitive content intellectual property, as well as plan to expand Kakao’s global influence by aggressively investing in new business sectors that we can do well,” said Bae Jae-hyun, an executive vice president at Kakao.

BY CHEA SARAH [chea.sarah@joongang.co.kr]