By Benson Daniel
South Korean video game billionaire Kwon Hyuk-bin is facing a potentially record breaking divorce settlement that could see his wife claim assets worth around $1.5 billion as their high profile legal battle reaches a critical stage.
Kwon, 52, is the founder of Smilegate, the company behind the globally successful video games CrossFire and Lost Ark. His fortune has been estimated at about $3 billion, placing him among South Korea’s wealthiest technology entrepreneurs.
His wife, Lee Hwa-jin, 53, has filed for divorce and is seeking a substantial share of his wealth, including an interest in Smilegate. The case has attracted significant attention because of the potential impact on ownership of one of South Korea’s major privately held gaming companies.
The amount at stake could be considerably larger than the cash settlements typically seen in South Korean divorce cases. Court ordered valuations have reportedly placed assets linked to Smilegate at several trillion won, meaning that a substantial division of the couple’s marital property could run into billions of dollars.
Lee has argued that she contributed to the growth of the business during its early years and has pointed to her involvement in the company’s development and management.
She reportedly held a significant stake in Smilegate during its formative years and occupied management positions as the business expanded.
Kwon, however, has disputed the extent of her contribution to the creation of his wealth. His position has been that he provided the initial capital for the company and was primarily responsible for building the business that eventually became a major force in the global gaming industry.
The court must first determine whether the divorce should be granted before deciding how the couple’s assets should be divided.
The outcome could have far reaching consequences for Smilegate because the company is not publicly listed in the same way as many of South Korea’s major technology firms. Any transfer of a substantial ownership interest could therefore have implications for its control and future structure.
Smilegate became one of South Korea’s best known gaming companies through the success of CrossFire, a first person shooter that developed a particularly large following in Asian markets. The company later expanded its international presence with Lost Ark, an online role playing game that attracted millions of players around the world.
The divorce proceedings have consequently developed into more than a dispute over personal wealth, with the possibility of a major change in the ownership of the gaming empire hanging over the case.
South Korean courts have increasingly faced complex disputes involving the division of business interests and wealth accumulated during marriage, particularly as technology and entrepreneurship have created enormous fortunes in relatively short periods.
The case involving Kwon and Lee is expected to provide another significant test of how marital contributions are assessed when a family’s wealth is closely tied to a privately held company.
For now, no final $1.5 billion payment has been ordered. The figure represents the potential scale of the claim and the assets that could become subject to division depending on the court’s eventual ruling.
The final judgment could therefore determine not only how the former couple divides one of South Korea’s biggest gaming fortunes, but also whether control of Smilegate itself could be affected.
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