Gaming giant Smilegate founder ordered to transfer 35 percent stake in record divorce ruling
A Seoul court’s 2.55 trillion won ($1.8 billion) asset-transfer decision could reshape governance at privately held game maker Smilegate if upheld on appeal.
Kwon Hyuk-bin, founder and chief visionary officer of Korean game giant Smilegate, was ordered to transfer 35 percent of his shares in Smilegate Holdings and other companies to his ex-wife in a divorce decision by the Seoul Family Court on Wednesday.
The decision comes three years and 11 months after Kwon’s ex-wife filed for divorce in November 2022.
The transfer, valued at 2.55 trillion won ($1.8 billion), marks Korea’s largest such asset transfer in a divorce.
Smilegate is one of Korea’s five largest game companies by revenue, with sales of 1.44 trillion won in 2025.
Kwon founded the company in 2002. It grew into one of Korea’s major game developers after its first-person shooter Crossfire became a major hit in China in 2008. Smilegate launched the massively multiplayer online role-playing game Lost Ark in Korea in 2018 and later expanded into anime-style games such as Epic Seven.
The company is also known for an ownership structure unusual for a game developer of its size. Smilegate has remained privately held without taking outside investment, while Kwon owns 100 percent of its holding company, Smilegate Holdings.
That arrangement has allowed Smilegate to make decisions without pressure from outside shareholders or the stock market. The freedom to focus on long-term investments and new games has been widely seen in the game industry as one of the reasons behind the company’s growth.
Wednesday’s ruling could change that structure if it becomes final.
A still from Smilegate's RPG game Miresi: Invisible FutureSMILEGATE
Kwon would retain a 65 percent stake, so his control of the company would not immediately be threatened. A simple majority is enough to appoint directors, approve financial statements and decide dividends, which would leave him in control of the board and day-to-day management.
Major corporate decisions are another matter.
With his stake reduced from 100 percent to 65 percent, Kwon would no longer have enough shares to approve certain major decisions on his own. The Commercial Act requires support from at least two-thirds of shareholders present at a meeting for matters such as changes to a company’s articles of incorporation, mergers and acquisitions and the removal of directors.
That means Kwon could need another shareholder’s support for major changes to Smilegate’s holding-company structure, mergers or spinoffs involving subsidiaries, or a corporate restructuring ahead of a potential stock market listing.
In other words, the fast decision-making that came with Smilegate’s private, single-owner structure could face new constraints.
Poster for Smilegate's Lost ArkSMILEGATE
The ruling would also change how dividends are distributed. Instead of Kwon receiving dividends on behalf of the entire company, they would be distributed according to each shareholder’s stake.
Some in the game industry have suggested that Kwon’s former wife could eventually sell her shares to a third party, such as investors in China. Such a sale is widely considered unlikely, however. A 35 percent stake would not provide management control, and shares in a privately held company can be difficult to sell.
The ownership shake-up is far from settled. Both sides are widely expected to appeal, so the final size and form of the asset division could change depending on the outcome of further court proceedings.
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
