A consortium of Kakao VX and Stonebridge Asset Management was picked as the preferred bidder for Ceragio Country Club (CC) in Yeoju, Gyeonggi Province and Saint Four CC in Jeju Island, which are owned by Halla Group, industry sources said on Monday (February 15). Ceragio CC is an 18-hole public golf course and Saint Four CC has a 27-hole public course and a 9-hole private course.
Market insiders believe Kakao VX may follow the growth strategy of Golfzon, which has a market share of 60% in the domestic screen golf market, and operates 17 golf clubs in the country through its subsidiary Golfzon County. The firm expanded its golf course business by securing private equity firm MBK Partners as a financial investor.
Likewise, Kakao VX entered the screen golf market in 2017 by purchasing Maum Golf, the second largest screen golf operator. Kakao adapted Kakao Friends’ popular characters to its screen golf system to increase its market share with young golfers.
Kakao VX is now the second largest screen golf operator with a market share of around 25%. Apart from screen golf, it has smart home training, a golf booking service through an artificial intelligence-based chatbot, and golf product businesses.
The firm raised 20 billion won ($18 million) from Q Capital in February 2020 to enter the new market, then acquired a 55% stake in Gaseung Development for 7.8 billion won in November. Gaseung Development is a golf club operator and developer that was established as a 50:50 joint venture by NXC, the holding company of South Korean gaming giant Nexon, and Seungsan. Gaseung Development owns real estate in Yongin, Gyeonggi Province, which could be developed into a golf course.
The company is also very active in golf course acquisitions and consignment operations. Kakao VX signed consignment agreements in 2019 with Gyeongnam Tourist Hotel and Hamyang Sky View Golf Club, an 18-hole public golf course. The company will have 72 holes if it is able to buy the two golf clubs from Halla Group.
“Kakao VX has continued to participate in a race for golf courses in partnership with its financial investor,” said a source. “The company is expected to keep expanding its business from screen golf to field golf courses.” (Reporting by Se-hun Jo)