Nexon Holding's 2nd Largest Shareholder Becomes Ministry of Economy and Finance... Late Kim Jung-ju's Family Pays Shares as Inheritance Tax

The family of Nexon founder Kim Jung-ju, who passed away last February, will pay inheritance tax by transferring NXC shares to the government as part of the payment. Payment in kind is a procedure where heirs pay inheritance tax with securities or real estate instead of cash, subject to certain conditions.

NXC, the holding company of the Nexon Group, announced on the 31st that the Ministry of Economy and Finance acquired 852,190 shares, equivalent to 29.3% of the total shares, becoming the second-largest shareholder as of last February.

The combined shareholding of Kim’s family?his spouse Yoo Jung-hyun, an NXC director, and their two daughters?decreased from 98.64% to 69.34%. Director Yoo’s shareholding remained unchanged at 34%, while the two daughters’ shares each dropped from 31.46% to 16.81%.

The reason the two daughters paid inheritance tax by transferring NXC shares is that among the assets left by founder Kim, NXC shares accounted for the largest portion.

Previously, in September last year, Director Yoo inherited 4.57% of founder Kim’s shares, raising her stake to 34% and becoming the largest shareholder. The two daughters each inherited 30.78%, holding 31.46% of NXC shares respectively.

After founder Kim’s passing, there were industry speculations that the family might sell part of their shares externally to cover the inheritance tax burden estimated at around 6 trillion won, potentially destabilizing management control. However, with the family transferring about 30% of shares to the government as inheritance tax, such concerns are expected to subside.

Director Yoo was appointed as an inside director at the shareholders’ meeting held at the end of March, marking her active participation in management. Voting rights and other related rights from the daughters’ shareholdings were also delegated to their mother, Director Yoo.

An NXC official stated, "The tax authorities conducted a proper valuation of the inheritance tax declaration submitted by the heirs, and accordingly, the heirs paid part of the inheritance tax by transferring some NXC shares to the government. Even after the transfer, the same individual and related parties maintain approximately 70% (69.34%) of the shares, so as the largest shareholder of NXC, stable management control of the company is expected to be maintained."