KakaoGames launched a co-CEO system led by Kim Tae-hwan (김태환) and Lee Si-woo (이시우) as it accelerates a shift to a Line Yahoo setup. With its largest shareholder changing from Kakao to an investment-purpose company backed by Line Yahoo and a reshuffle of the board and management completed, the company’s next tasks have moved to business synergies with the new shareholder and results from new titles in the second half.

KakaoGames held an extraordinary shareholders meeting on June 22 at the Kakao AI Campus in Yongin, Gyeonggi province. Shareholders approved as proposed the appointments of former Line Games vice president Kim and KakaoGames chief business officer Lee as inside directors. The board meeting that followed appointed the two as co-CEOs.

Shareholders also approved the appointment of Lim Tae-seob (임태섭), a professor at Sungkyunkwan University GSB, as an outside director, and Seo Seok-ho (서석호), a managing director at Petrico Partners, as a non-executive director. The terms for Kim, Lee and Lim are 1 year and 9 months each, while Seo’s term is 9 months.

Management reshuffle completed after top shareholder change

The management change is a follow-up procedure after the change in the largest shareholder was completed on June 19. KakaoGames disclosed that its largest shareholder changed from Kakao and 13 others to EtripleA Investment LLC and 10 others, following a third-party allotted paid-in capital increase and the execution of a share purchase agreement.

After the change, the stake held by the new largest-shareholder side is 38.95 percent. EtripleA Investment holds a total of 35,566,086 KakaoGames shares, representing a 33.43 percent stake. Kakao’s stake, previously the largest, fell to 14.68 percent from 37.93 percent.

EtripleA Investment is an investment-purpose company established through Petrico Private Equity Fund VI, whose largest investor is LY Corp. KakaoGames said the purpose of the stake acquisition is a strategic investment to strengthen global business competitiveness and secure a foundation for mid- to long-term growth.

The deal brought KakaoGames total new funds of 300 billion won, including 240 billion won from the third-party allotted paid-in capital increase and 60 billion won from the issuance of convertible bonds. The company is expected to secure financial leeway while moving ahead with a business reorganisation centered on the new management.

Kim is a game industry strategy specialist who has worked at Nexon Korea, Nexon Japan, Nexon America and Line Games. He is expected to take charge of a mid- to long-term growth strategy under the new largest-shareholder structure, based on his experience in global business and new business development. Lee is an in-house business specialist who has led KakaoGames’ mobile business after working at NHN, Wemade and the Game Talent Foundation. He is expected to be responsible for continuity in company operations and the publishing business.

Line Yahoo synergy is a task to specify

A key task for the new setup is to specify synergy with Line Yahoo. KakaoGames has used KakaoTalk-based pre-registration, coupons and event promotions to increase user inflows and marketing efficiency in the domestic mobile game market. Line Yahoo has a user base centered on the Line messenger in Japan and Southeast Asia. For KakaoGames, that creates room to expand platform marketing experience built at home into Line-based markets.

Specific commercialisation plans have yet to be finalised. In a question-and-answer session after the meeting, newly appointed chief financial officer Shin Kwon-ho (신권호) responded in the sense that there is nothing confirmed about the possibility of a merger with Line Games. He added that the company is leaving open the possibility of cooperation with Line Games, as KakaoGames has worked with Kakao affiliates.

On ways to use the Line platform, Shin said it has not reached the point of commercialisation ideas. He explained that game market potential in Southeast Asian markets where Line Yahoo has strengths, including Thailand, Vietnam and Indonesia, has risen compared with the past. That means the company can look into the possibility of further market targeting by leveraging Line’s existing success experience.

That also aligns with KakaoGames’ existing growth approach. KakaoGames has grown by combining KakaoTalk-based user touchpoints with its publishing capabilities. Under the new setup, the key question is whether this structure can be expanded from a domestic focus to Asian markets. Still, whether the game business capabilities of Line Yahoo and Line Games lead to actual improvement in KakaoGames’ performance must be verified through new title launches and overseas marketing results.

Results to be tested through new title performance and shareholder communication

KakaoGames has recorded losses for 6 consecutive quarters. On a consolidated basis for the first quarter of 2026, revenue was 82.9 billion won and operating loss was 25.5 billion won. The launch of the new management and the inflow of 300 billion won can increase financial leeway, but whether performance rebounds ultimately depends on results from new titles.

KakaoGames plans to sequentially launch 5 new titles from the third quarter through year-end. The key anticipated title is the MMORPG "Odin Q: Valkyrie Call," being developed by Lionheart Studio. It is a follow-up to "Odin: Valhalla Rising," which was a hit in Korea’s mobile MMORPG market in 2021, and recently opened a teaser site and revealed its official title and key visuals. Other titles in the second-half lineup include "Dokkaebiui Segye," "ArcheAge Chronicle," "God Save Birmingham" and "Project C."

The new management also faces the task of communication with the market. At the meeting venue, a minority shareholder group expressed regret over the absence of the new CEOs. The company explained that the new CEOs did not attend for procedural reasons because the appointment of representative directors was confirmed at a board meeting after the shareholders meeting.

The minority shareholder group is calling for greater shareholder value and expanded communication, including plans for treasury shares, the new title launch schedule and shareholder meetings. Shin said various options can be reviewed on the use of treasury shares, including bringing in external talent or cancellation, while adding that he understands shareholder value enhancement should be the top priority. He also responded in the sense that the company will arrange opportunities to communicate with the market in consultation with the new co-CEOs.

KakaoGames has secured financial leeway with the launch of the new largest-shareholder structure and the inflow of 300 billion won, but it also faces dilution pressure from the capital increase and losses for 6 consecutive quarters. The first assessment of the co-CEO system will likely depend on specifying cooperation with Line Yahoo, the second-half new title launch schedule and whether performance improves.