“We’ll get the valuation proper” IPO giants head to Nasdaq

Naver Webtoon will probably be listed on NASDAQ tomorrow
Yanolja may also file paperwork with the SEC subsequent month
Elevated consciousness helps appeal to world funding
The home inventory market might lose momentum as a consequence of lack of economic stability

Lately, main home corporations akin to Naver Webtoon and Yanolja, that are thought of the most important IPOs, have been knocking on the door of the US inventory market one after one other. The rationale they’re turning to abroad inventory markets is as a result of they imagine there are extra advantages akin to elevating consciousness and attracting world funding by way of abroad inventory markets.

In line with the US Nasdaq web site on the twenty fifth, Webtoon Leisure, Naver Webtoon’s headquarters and US company, submitted a securities report for an IPO to the US Securities and Alternate Fee (SEC) on the thirty first of final month (native time) and plans to be listed on Nasdaq on the twenty seventh.

Naver is the primary shareholder of Webtoon Leisure, with a share of 71.2%. Yahoo Line owns 28.7%. The specified public providing worth vary is $18 to $21 (roughly 25,000 to 29,000 gained) per share, and the post-listing bodily worth is predicted to succeed in utilizing the general public providing worth excessive as much as $2.67 billion (about 3.7 trillion gained). . International media akin to Bloomberg estimated that Naver Webtoon might increase $500 million (about KRW 692.5 billion) by way of a list.

Evaluation within the business is that Naver Webtoon’s itemizing on Nasdaq is a option to broaden the worldwide affect of home content material and search funding avenues. Webtoons are extremely malleable companies, together with not solely authentic works, but additionally drama and movie manufacturing, and companies utilizing mental property (IP) rights. Massive world funding will be secured primarily based on sturdy home content material.

Yanolja, which has been pursuing a transfer to Nasdaq after attracting funding from Japan’s Softbank, is predicted to file paperwork with the SEC round subsequent month. It’s anticipated to boost $400 million (about KRW 547.3 billion) by way of itemizing, and the company worth is predicted to succeed in as much as KRW 12 trillion.

Company valuation is the most important motive why main home corporations go to overseas securities markets moderately than home securities markets. Within the home inventory market, it’s stated that it’s tough to precisely assess company worth, with listed corporations being valued (Korean low cost). As well as, the present inventory market has not regained its momentum and is caught in a field space. The Customary & Poor’s (S&P) 500 and Nasdaq indexes are at all-time highs.

Another excuse to go to the US inventory market is that becoming a member of NASDAQ, which has a strict itemizing course of, can enhance recognition as a worldwide firm. To enter the NASDAQ market, strict standards akin to monetary stability and governance have to be met. On this means, it may be proven that the corporate is superior within the monetary, accounting and funding sectors.

On March 11, 2021 (native time), Coupang Chairman Kim Beom-seok (third from left) and executives ring the ‘opening bell’ to checklist on the New York Inventory Alternate (NYSE) rejoice Supplied by Coupang
Nevertheless, coming into the US inventory market will not be a assure of success. The problem is to point out tangible outcomes after itemizing. As for Coupang, its inventory worth has declined with out important progress since its itemizing on the New York Inventory Alternate (NYSE). Webtoon leisure additionally entered a section of gradual progress as demand for content material decreased after the pandemic.

As big-ticket IPOs akin to Naver Webtoon and Yanolja are bought out to abroad inventory markets, there are considerations that home inventory market competitiveness will inevitably weaken. In a scenario the place the home inventory market has already misplaced its progress engine and is even mocked as a ‘boxing index’ (KOSPI stays within the boxing space), if the withdrawal accelerates massive IP listings , the expansion engine of the long run. the home inventory market might cool.

An official within the home securities business stated, “It’s price noting that though the home IPO public providing market has been booming not too long ago, many corporations are going to the US inventory market.” He stated, “As a result of the home inventory market is much less dynamic, corporations with excessive progress potential are going overseas.”

Reporter Nam Hye-jeong namduck2@donga.com
Reporter Lee Dong-hoon dhlee@donga.com