Tencent-backed Shift Up may price IPO at top end of band

South Korean gaming company Shift Up, backed by China's Tencent, is set to price its initial public offering at the top end of its price band and raise 435 billion won (USD313 million), according to a source with knowledge of the matter.

Books close this week and pricing is expected to be finalised on Mon, said the source, who declined to be identified because the information was confidential.

If finalised, the pricing would give the game developer a market capitalisation of 3.5 trillion won (USD2.52 billion).

Tencent is Shift Up's second-largest shareholder with a 40% stake, which is expected to shrink to about 35% after the public offering, analysts said. The largest shareholder is founder and CEO Kim Hyung-tae.

Shift Up, which debuted its first game "Destiny Child" in 2016, succeeded with mobile game "Goddess of Victory: Nikke" which has booked 255 billion won in sales between its global launch in late 2022 and the first quarter of 2024.

Its latest title "Stellar Blade" released on PlayStation 5 in April with an exclusive publishing deal with Sony, opens new tab, hit No. 1 in Japan's PlayStation download rankings and No. 2 in North America, analysts said.

Shift Up reported an operating profit of 111 billion won in 2023 out of 169 billion won in revenue. This compares with a 18 billion won operating profit in 2022, according to a company filing.

It is expected to list sometime in Jul.