Kakao Games held a shareholders meeting immediately after disclosing a change in its largest shareholder to LAAA Investment, an investment purpose vehicle under LY Corp (Line Yahoo), and reappointed CEO Han Sang-woo (한상우).

Kakao Games held its 13th regular shareholders meeting on March 26 at the Kakao AI Campus in Suji-gu, Yongin, Gyeonggi Province. With 518 shareholders present, representing 50,371,092 shares, or 56 percent of voting shares, all agenda items were approved as proposed, including approval of financial statements, partial amendments to the articles of incorporation, Han's reappointment, appointment of audit committee members and approval of the cap on directors' remuneration. The remuneration cap was cut to 6.0 billion won from 8.0 billion won a year earlier.

In his business report, Han said 2025 consolidated revenue fell 26 percent from a year earlier to 465.0 billion won and the operating loss came to 39.6 billion won. Total assets were 2.68 trillion won, total liabilities were 1.48 trillion won and total equity was 1.20 trillion won. The company said it had laid the groundwork for mid- to long-term growth by reorganising its business portfolio and improving operational efficiency despite worsening profitability.

Han Sang-woo: "This year is about new titles, not change"

After the meeting, Han met reporters and was asked about the equity restructuring disclosed the previous day and the company’s future management direction.

Asked about the direction of cooperation with LY, Han said the two sides had agreed on the investment to secure resources for overseas business investment and strategic investments Kakao Games needs. He said specific matters could be discussed in stages after detailed talks under the broad direction.

On concerns about overlapping business with Line Games, which is grouped under the Line Yahoo umbrella, he said the specific details had not been decided. He also said the company needed further discussions among management, taking into account various variables, on a listing of Lionheart Studio.

On the schedule for new title launches this year, he said it was the first task the company considered most important. He said the most important thing was to launch already-known major IP titles well this year, and that the company had also secured additional funds, adding that the rest should be pursued slowly for the future.

Asked about the possibility of a company name change or a shift in service platforms, he replied there had been no discussions at all. He stressed that both groups of shareholders agreed it was necessary to maintain Kakao Games' goodwill and what it needs to do in a stable way, and that they agreed not to significantly shake the direction at least until this year's launch.

Asked what was discussed at a town hall meeting for employees the previous day, Han said the key message was that development staff were also focused on new title launches and that it would not be affected. He added that both groups of shareholders agreed the company’s performance was most important, and that the transaction structure also stipulated the principle of succession of employment.

Cho Young-min CFO: "Allocate funds after strengthening financial soundness"

In a separate question-and-answer session after the meeting, CFO Cho Young-min (조영민) stood before reporters to explain the transaction structure and financial status.

Asked about the observation that LAAA Investment appeared to be structured like a private equity fund, Cho said discussions had set the structure so that not only LAAA Investment but also Kakao would participate. He said the largest contributor in that investment structure at the time the deal closes would be LY. Kakao will remain the second-largest shareholder by selling some existing shares while reinvesting in a new share issuance. Cho said additional investors were possible but nothing had been confirmed.

Asked about detailed uses for the 300.0 billion won funding, he said the company currently had about 500.0 billion won in standalone cash and that it would exceed 800.0 billion won after the final payment in May. He said it planned to reorganise its funding structure after improving financial soundness indicators. He withheld a detailed plan, saying specific allocations for securing liquidity, IP investment and global expansion would be decided by a new management team joining upon the deal’s closing.

On a Lionheart Studio IPO, he drew a clear line, saying there were no Lionheart Studio-related clauses in the strategic investment agreement contractually or legally. He said it was true that LY had highly evaluated Lionheart Studio's development capabilities and global expansion potential in the process of deciding the investment. On timing for pursuing an IPO, he said the priority was to maximise corporate value after confirming the performance of 'Odin Q', expected to be released in the third quarter, and indicated it would not rush.

Asked about plans to create synergy with Line Yahoo, Cho said he had not yet heard what strategic direction LY had as the largest shareholder. He added he expected there would be a process to share the direction with internal members first before the deal closes at the end of May.

Asked about the possibility of changes to the new title launch schedule, he said the visibility of new titles and their launch timing were the items most thoroughly verified during due diligence for the investment. He said there could be some minor adjustments but no major changes.

Ultimately, the message from Kakao Games management on the day was clear. Despite the major variable of a change in the largest shareholder, it would at least this year prioritise new title launches and a recovery in performance over organisational restructuring. Still, detailed allocations of the 300.0 billion won and mid- to long-term strategy under the Line Yahoo structure will be left to the judgment of a new management team after the deal closes.