Nexon and NCsoft reportedly in talks to buy Valve

Korean publication reports price discussed more than $893 million

JoongAng, one of the top newspapers in South Korea, reported that Nexon and NCsoft (of which Nexon is the biggest shareholder) met with Valve in Hawaii to discuss a possible deal, said to be worth more than $893 million, according to VentureBeat. The companies reportedly met September 26th at Nexon's developer summit.

The deal would create a a powerful combination of Nexon's 60+ games like free-to-play MMO MapleStory with Valve's best-selling games like Left 4 Dead and Half-Life. Valve's digital distribution powerhouse Steam, which by some estimates controls 70 percent of the market for digitally distributed PC games, reportedly accounts for half of Valve's revenues, and is a powerful attraction to potential buyers.

Nexon's revenues for 2011 topped $1.1 billion, and they have continued to grow this year. NCsoft had revenues of over $540 million in 2011. Estimates from various sources put Valve's annual revenue in the range of $600 to $800 million or more, with the company valued at $1.5 billion to as much as $4 billion. Reportedly Valve has already turned down offers in excess of $1 billion, including one from Electronic Arts.

Valve CEO Gabe Newell has said, speaking to The New York Times, that there was a better chance Valve would disintegrate, with its workers scattering, than the company would be sold. "It's way more likely we would head in that direction than say, 'Let's find some giant company that wants to cash us out and wait two or three years to have our employment agreements terminate.'"

Nexon spokesman Mike Crouch declined to comment on the story, according to VentureBeat. NCsoft reps told Polygon "There is no truth to this rumor."

Given the estimates of Valve's worth, it seems unlikely that a deal for the company would close at a mere $893 million, especially considering the company's previous reluctance to deal.

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Latest comments (16)

Maarten Brands Director, Cook & Becker6 years ago
Extremely unlikely. Apart from the fact that Valve has stated repeatedly that they will not sell (and why would they seeing as they are more profitable per employee than Google), Valve is also in a better position to raise the capital to buy NCsoft or Nexon than vice versa.

More likely the talks are linked to Valve's rumored hardware strategy or some other high-level partnership.

Edited 1 times. Last edit by Maarten Brands on 27th September 2012 10:09am

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There is no smoke without fire (tiny embers maybe)
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Klaus Preisinger Freelance Writing 6 years ago
There are ways to discuss $800 million deals without discussing a buyout. Especially with all the hardware rumors surrounding Valve. If there really is a consolized PC in the making, then having an Asian connection for software support is not a bad idea at all. Consoles do relatively bad in Korea, Nexon and NCsoft do pretty well in Korea, so them partnering with Valve on a console makes sense in a way.
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Show all comments (16)
Kingman Cheng Illustrator and Animator 6 years ago
Not going to happen, Gabe already said before (not in exact words) that he'd rather sink the ship and go down with it than have it bought out. In fact I'm sure he said that again very recently?
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James Prendergast Research Chemist 6 years ago
Doesn't make much sense to me... If a F2P or mobile developer is worth $500-1 billion when they're not making money then Valve (which are making money) sure as hell are worth more.

@ The people who say "But Valve said this".. they've gone back on their word or been a bit lax with their meanings of their words before. I don't trust them any more than I trust EA to keep servers online.
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Reading between the lines, there might not be a buy out involved. BUT
with Valve going F2P, a joint development agreement could be in the works whereby redistribution,development could be agreed amounting to $820 million. Juicy gossip indeed
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Jim Webb Executive Editor/Community Director, E-mpire Ltd. Co.6 years ago
I'm more inclined to believe that some PR rep at NCSoft or Nexon simply tipped off the newspaper to get some global publicity for the comapny.
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Leif Peterson 3D Artist, Gameloft Montreal6 years ago
I could swear I heard a Rumor that Nexon and NCsoft wanted to buy EA, how has that turned out? It didn't... I'm not going to particularly believe any rumors about those companies buying a big western company.
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Adam Campbell Game Manager, Azoomee6 years ago
Talks happen regardless of whether or not companies are willing to sell out.
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Mihai Cozma Indie Games Developer 6 years ago
I totally agree it must have been about some other deal.
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Andrew Goodchild Studying development, Train2Game6 years ago
I find it hard to believe that if Valve wanted to sell, that's all they could expect, when Pop Cap sold for $650M. That's no dig at Pop Cap, but I don't believe it has compatible value to Steam.
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Anders Petersen Interaction Designer, NDS6 years ago
@Klaus Preisinger
Sure, but the larger point escapes me: Why would Valve suddenly become hell-bent on doing more business in South Korea in the first place? It makes no sense to me.

Edited 1 times. Last edit by Anders Petersen on 27th September 2012 6:09pm

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Morville O'Driscoll Blogger & Critic 6 years ago


"a Forbes report from March estimated the firm’s value at $3 billion, with cofounder Gabe Newell’s personal net worth believed to be about $1.5 billion."!


@ Chee
BUT with Valve going F2P, a joint development agreement could be in the works whereby redistribution,development could be agreed amounting to $820 million. Juicy gossip indeed
This could be be kind of it. Valve have a good deal of experience in F2P (TF2 especially, and DOTA 2 upcoming), so it wouldn't surprise me that people would be willing to try and get in on their knowledge of F2P, as well as Steam's position as a market leading platform.

But Valve being bought out? Just... Why? What point is there in that? They'd lose control of everything, eventually.
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Greg Wilcox Creator, Destroy All Fanboys! 6 years ago
Heh. Maybe they're tired of raging people threatening them about Half-Life 3. Conversely, perhaps this is a distraction set up by Valve with Nexon's aid because Half-Life 3 is coming sooner than later. Yeah, I'm crazy, but that's also common knowledge. Then again, I'm also patient enough to wait for whatever news about that game for as long as it takes.
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Simon Dotschuweit MD SE / CTO, Dorado Games6 years ago
Ain't gonna happen :)
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Klaus Preisinger Freelance Writing 6 years ago
I do not believe Valve necessarily wants to expand to South-Korea. I believe that if Valve is working on a console, they are looking for partners to team up and share costs with. Those need to be partners who have a market in which a new console still makes sense and who can support their market with games.

South-Korea is notoriously console free, Nexon and NCsoft already have ready to ship games for the alleged console of Valve. While we might look at it as the Valve console, the Asian market gets a version with two Asian publishers at the front which are as much of a know quantity to the consumer in Asia, as Valve is in the west.

Valve releasing in South Korea is just an added bonus.
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