Smilegate founder Kwon Hyuk-bin has been ordered by a court of first instance to transfer approximately 2.5 trillion won worth of assets in kind as part of his divorce proceedings with his spouse, identified by her surname Lee.

The amount far exceeds the 944 billion won property division that the Supreme Court ordered SK Group Chairman Chey Tae-won to pay in July, making it the largest divorce property settlement ever awarded in South Korea. If the ruling becomes final, significant changes are expected to Kwon’s exclusive 100% control of Smilegate, a governance structure that has remained in place since 2012.

Particular attention has focused on the revelation that Kwon’s assets are valued at more than 7 trillion won. After turning CrossFire, which initially struggled in South Korea, into a major success in China, Kwon added global hits such as Epic Seven and Lost Ark, transforming Smilegate into a gaming company with annual revenue exceeding 1 trillion won.

Because Kwon owns 100% of the shares in the company at the top of the group’s ownership structure, Smilegate’s rising corporate value has translated directly into an increase in the value of his equity holdings.

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Chon Hyeong Hwan, Managing Partner at MegaX Law Office, described the potential change as “a shift from one-person control to a governance structure subject to checks and balances.”

“A 35% stake exceeds one-third of the total outstanding shares, meaning its holder could exercise considerable influence over major corporate decisions requiring a special resolution,” Chon said.

The ultimate impact on Smilegate’s governance structure will depend on how the property division is finalized.

The court of first instance has ordered the transfer of a 35% equity stake along with 65 billion won in cash. However, the situation could change if the proportion of cash is increased during the appellate proceedings or through a settlement between the parties.

Because the majority of Kwon’s wealth consists of Smilegate shares, raising several trillion won in cash could require him to leverage his holdings through measures such as share-backed loans or the sale of part of his equity stake.

“If part of the stake is sold to a third party, it could provide the necessary cash, but the entry of a new shareholder could also alter the company’s governance structure,” Chon said.

“Ultimately, what matters more than the division ratio itself is who ends up holding the 35% stake and under what conditions.”

Kwon has served as Smilegate’s Chief Visionary Officer (CVO) since 2020, overseeing the group’s long-term business strategy. This year, Smilegate integrated three of its major entities — Holdings, Entertainment and RPG — while continuing development of new titles including Chaos Zero Nightmare and Lost Ark Mobile.

The global performance of these new titles and their ability to follow the success of franchises such as CrossFire are expected to serve as key indicators of Smilegate’s future corporate value.

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