Qoo10 buys US e-commerce platform Wish for $173 mn

Southeast Asia-focused e-commerce platform Qoo10 Pte. has agreed to acquire Wish, a US online marketplace, for $173 million from Nasdaq-listed ContextLogic Inc., the two companies said on Monday, a deal expected to build Qoo10’s presence in North America and Europe.

The acquisition will bolster Qoo10's global supply chain amid growing threats from Chinese rivals such as AliExpress and Temu, rapidly penetrating South Korea with a diverse assortment of products at ultra-low prices.

“With this acquisition of Wish, we will be able to expand our global logistics network and operations beyond Asia and secure a foothold in North America and Europe,” Qoo10 said.

“This deal marked the first case of a Korean e-commerce company's advance into a global market,” it added.

Wish, founded in 2010, generates about 80% of its revenue from Europe and the US, operating in about 200 countries with 33 languages. It boasts an extensive global supply chain that extends to South America and Africa. 

It offers 80 types of products, including living, fashion, beauty and electronic products, to more than 10 million customers every month, according to Qoo10.

Wish provides delivery service in partnerships with more than 20,000 retailers in Europe and the Americas.

Qoo10’s founder and Chief Executive Ku Young Bae pioneered South Korea’s e-commerce market with the launch of Interpark in 1995. Four years later, it established another online mall GMarket and then sold it to eBay, a US online market operator, in 2009.

The following year, he shifted his focus to Southeast Asia to set up Qoo10 and expanded into China and India. He had stayed away from South Korea due to a 10-year reentry ban under an agreement with eBay.

After the 10-year ban expired, he gobbled up leading Korean e-commerce players such as TMON Inc., Interpark Corp. and WeMakePrice Inc.

Qoo10 capitalized on high purchasing power in Singapore with high-quality Korean products, elbowing out Chinese platforms focused on low-price products.

SEEKING A NASDAQ LOGISTICS UNIT LISTING

The deal came as the company has been working on the Nasdaq listing of its logistics unit Qxpress Pte.

Qoo10 had held negotiations to buy 11Street, a domestic online marketplace, from SK Group, a deal estimated at up to 1 trillion won, but suspended the talks.

ContextLogic said that its board of directors has unanimously approved the sale of Wish. The sale price represents an approximately 44% premium to ContextLogic’s closing stock price on Feb. 9, the last trading day before the transaction announcement.

“The board believes the transaction will effectively reduce the cash burn in ContextLogic to near zero and monetize its operating assets,” Tanzeen Syed, chairman of ContextLogic’s board, said in a statement

The company expects to complete the transaction in the second quarter of this year. ContextLogic will remain listed on Nasdaq after the sale of Wish.

Write to Jae-Kwang Ahn at ahnjk@hankyung.com

Yeonhee Kim edited this article.