Daou Kiwoom Tapped as Potential New Owner of Munhakdongne; "Editor-Led Management" at Turning Point After 33 Years

Selected as preferred negotiating partner for Munhakdongne after JoongAng Ilbo... Four companies competed
Founder Kang Byeongseon sets conditions, including expanding publishing IP and protecting editorial independence
100% stake sale pursued... Sha

Daou Kiwoom Group has been selected as the preferred bidder to acquire Munhakdongne, one of South Korea's leading literary publishers. As the group, which is pursuing a takeover of JoongAng Ilbo, moves closer to acquiring the country's largest literary publisher as well, attention is turning to how the publishing and media industries could be reshaped. There is also interest in how Munhakdongne's publishing principles and management structure might change if it becomes part of a large conglomerate, having maintained editor-led management and publishing autonomy since its founding in 1993.

Munhakdongne headquarters. The Asia Business Daily DB.

Kang Byeongseon, Munhakdongne's founder and largest shareholder and its former CEO, who writes under the pen name Kang Taehyeong, told employees at a meeting on the afternoon of October 23 that Daou Kiwoom Group had been selected as the preferred negotiating partner for the acquisition, according to publishing industry sources. He reportedly said the group was chosen after reviewing four companies that had submitted letters of intent.

Kang reportedly told employees that the main criteria for selecting a buyer were whether it respected the traditional values of publishing, had the capacity to expand its business using literary intellectual property (IP), and could guarantee editorial independence and employees' rights.

Kang had initially said that the buyer should be "a company that loves literature, respects the rights of literary figures, and is committed to the cultural and arts business." The point, he said, was that the ability to pursue new ventures while carrying on Munhakdongne's publishing values mattered more than the acquisition price. Daou Kiwoom Group's offer was reportedly not the highest among the four finalists.

The sale process gained momentum in September, when Kang decided to sell his 41.5% stake in the company. The remaining shares are held by other shareholders, including writers and critics, who own 51.8%, while the company holds 6.7% in treasury shares. The other shareholders include the founding editorial board members of the literary magazine Munhakdongne.

The companies involved in negotiations had sought to acquire 100% of the company, rather than just Kang's stake. However, some observers said negotiations could prove difficult, as shareholders who had been involved with the company since its early days disagreed over selling all their shares in a single transaction.

As recently as last month, some shareholders were hesitant about selling their stakes or opposed to the idea. Kang has since worked to persuade them, and at a briefing for employees on October 23, he reportedly said that the shareholders had agreed to sell 100% of the shares. The actual scope of the sale and its specific terms are expected to be finalized during the contract process.

Selection as the preferred negotiating partner is a step toward signing an acquisition agreement. Munhakdongne also expects due diligence and negotiations for a final agreement to follow.

Daou Kiwoom Group is a conglomerate that grew out of Daou Technology, founded in 1986. Its main businesses are in information technology (IT) and finance, including Daou Technology and Kiwoom Securities, but it has also expanded into the production and distribution of webtoons and web novels.

KidariStudio, one of the group's leading affiliates, operates in domestic and overseas webtoon markets through Lezhin Comics, Bomtoon, and Delitoon. Observers say the content production and distribution capabilities and overseas platform network it gained through acquisitions, including that of Lezhin Entertainment, could be applied to Munhakdongne's publishing business.

Munhakdongne has built up a roster of authors and a catalog focused on novels and poetry. It has discovered emerging writers through literary awards such as the Munhakdongne Novel Award, the Munhakdongne New Writer Award, and the Young Writer Award, and expanded its influence in the Korean literary market by publishing works by leading authors, including Han Kang.

If this literary content is combined with Daou Kiwoom Group's webtoon and web novel production capabilities and overseas distribution network, there may be opportunities to expand into adaptations and other derivative content based on original works, as well as overseas business. Daou Kiwoom Group could broaden the scope of its content business by leveraging the publisher's network of authors and editorial capabilities.

Another notable feature of the deal is that Munhakdongne was not put up for sale due to financial difficulties. In 2025, the publisher recorded revenue of KRW 36.87 billion and operating profit of KRW 7.09 billion. Although revenue was below the KRW 46.3 billion recorded in 2024, when sales surged after Han Kang won the Nobel Prize in Literature, Munhakdongne still maintained an operating margin of about 19.2% last year.

Munhakdongne's major shareholders have said the sale is intended to diversify the business in response to structural changes in the content industry, rather than to address a downturn in publishing. They believe that relying only on a traditional publisher's existing funds and staff would limit efforts to expand literary works into different media beyond print books.

Daou Kiwoom Group has also been selected as the preferred bidder in the contest to acquire JoongAng Ilbo. On October 19, it secured that status through a consortium formed with CJ Group to acquire control of the newspaper. JoongAng Ilbo has been pursuing a sale under the direction of its creditors since entering a corporate restructuring program in July.

The acquisition of JoongAng Ilbo is a separate transaction being pursued by the Daou Kiwoom-CJ consortium and is unrelated to the sale of Munhakdongne. If both deals are completed, Daou Kiwoom Group will expand its content business beyond its existing webtoon and web novel operations into newspapers and literary publishing.

The key question is what will happen to Munhakdongne's independent publishing and management structure. The publisher has developed a distinctive management model in which an internal candidate with an editorial background takes over as CEO, moving away from founder-centered management. A key feature is the so-called "3-3-3 system": a new CEO serves as co-CEO with the outgoing CEO for three years, then as sole CEO for three years, before serving as co-CEO with a successor.

The sale process has also raised questions about whether this management structure could change. On October 19, Co-CEO Kim Soyoung announced that she would resign at the end of October, more than a year before her term was due to end. Kim has served as CEO since 2019 and currently shares the role with Lee Hyeonja. Her sudden resignation prompted speculation that internal disagreements over the sale of shares may have played a role, but the specific reason has not been disclosed.

The publishing industry is watching to see whether Munhakdongne can preserve its editorial independence and author-centered publishing principles after the acquisition. Discovering new writers and developing their work take time, and many areas of literary publishing are difficult to evaluate based on short-term returns. A key management challenge will be finding a way to reconcile the business strategy of a large conglomerate with the independent decision-making structure of literary publishing.

Kang's emphasis on protecting editorial independence and employees' rights as conditions of the acquisition is seen as a response to these concerns. How Daou Kiwoom Group will reflect those commitments in the final contract and management structure is expected to become clear in the negotiations ahead.

This content was produced with the assistance of AI translation services.