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Naver is embarking a full-scale reexamination of its globalization efforts, including a US-focused reorganization of its webtoon division.

On May 28, Naver explained, “Our subsidiary Webtoon Entertainment has decided to issue new shares and acquire all equity in Line Digital Frontier, which currently belongs to the Japanese corporation Line.”

“The plan is to have the US-based Webtoon Entertainment supervise the global webtoon project, with webtoon branches underneath it for South Korea (Naver Webtoon), Japan (Line Digital Frontier), and so forth,” it said.

Webtoon Entertainment is issuing a total of 70,072,733 new shares (worth 232.1 billion won, or US$186.6 million) to allocate to Line as it acquires LINE Digital Frontier.

Naver Webtoon, a subsidiary under Naver’s full ownership, currently serves as a head office for webtoon efforts in South Korea. The framework is one in which it controls Webtoon Entertainment and Line Digital Frontier as Naver sub-subsidiaries operating webtoons in the US and Japan, respectively. Naver Webtoon' currently owns a 30% stake in Line Digital Frontier. Once Webtoon Entertainment purchases Line’s remaining shares of Line Digital Frontier, Naver Webtoon will have full ownership of all of the subsidiaries. In the future, Naver plans to revamp its project structure to make Webtoon Entertainment the head office with the South Korean and Japanese branches underneath it. Once the webtoon project governance structure changes are complete, Naver and Line will respectively own 66.6% and 33.4% of the new “webtoon head office” of Webtoon Entertainment. Naver is also pursuing procedures for the Line-Yahoo merger that it announced with SoftBank in November of last year. The Webtoon Entertainment equity structure could see additional changes once that merger is completed through Z Holdings in the second half of 2020.

Explaining the reasons for its structural changes, Naver said they were intended to “expand the Naver webtoon project beyond Asia and North America into regions where webtoons have yet to become established, including Europe and South America.”

Naver also said that it wants to “more quickly establish the US as a base region amid a rapidly changing global entertainment industry and more actively pursue intellectual property projects with the world’s most powerful entertainment companies, such as Disney and Netflix.”

By Choi Min-young, staff reporter

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