Crypto Exchange Bithumb to Be Acquired By South Korean Gaming Giant, Nexon, for $460M
South Korean cryptocurrency exchange Bithumb wants to put a troubling 2020 behind it and look to the future. It appears that the company’s plans also involve new owners.
Per local news sources, multi-billion-dollar gaming company Nexon is in advanced talks to purchase the exchange outrightly.
Time to Move On
Nexon’s chief executive Kim Seoung-Ju is in talks with some top Bithumb officials over a possible buyout worth 650 billion won ($460 million), local news outlet Mekyung reports. The deal is said to be advanced, as both parties have reportedly signed a memorandum of understanding with Vidente, one of Bithumb’s top shareholders. If everything works out as planned, Nexon would control three top crypto exchanges in South Korea. Nexon already owns Bitstamp and Korbit.
The $460 million price would give Nexon a 65 percent stake in Bithumb. Nexon had reportedly been in talks with Bithumb and several shareholders since August 2020 over a potential sale. The gaming company also took part in a September auction, which involved several potential investors and equity fund managers from home and abroad.
Bithumb’s Big Baggage
However, the acquisition process was slowed down due to investigations into Lee Jong Hoon, the chairman of Bithumb Korea.
The same month as the auction, Seoul Shinmun reported that an intelligence crime unit at the Seoul Metropolitan Police Agency had searched Bithumb’s Gangnam District office. The checks were connected with investigations into Hoon, who was being probed over alleged economic fraud concerning the BXA token.
Per the report, Hoon had promoted BXA as Bithumb’s native token, encouraging investors to purchase the asset. However, the token turned out to be a high-scale fraud endeavor with over 30 billion won ($25 million) in reported damages.
The Nexon sale isn’t the first time that Bithumb will go through a potential acquisition. In 2018, Hoon was reported to have been shopping for a buyer for the exchange. However, his 400 billion won asking price at the time was considered to be too much.
Local news sources reported in September 2020 that the company was up for sale again per reports, Bithumb Holdings, the exchange’s largest shareholder, had promoted it to interested buyers. Local financial giant Samjon KPMG was overseeing the sale, with several interested companies already submitting proposals. The firm was reported to have asked for 500 to 700 billion won at the time.