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Shinsegae-Naver consortium one step closer to eBay Korea acquisition

Shinsegae has outplayed long-time rival Lotte in the enduring race for Korea's third-largest e-commerce player

By Jun 16, 2021 (Gmt+09:00)

Shinsegae Group heir-apparent and Vice Chairman Chung Yong-jin
Shinsegae Group heir-apparent and Vice Chairman Chung Yong-jin

Shinsegae is the likely winner of the eBay Korea acquisition, outplaying its rival Lotte in the prolonged race to buy the country’s third largest e-commerce player.

According to investment banking sources on June 16, a consortium led by Korea’s retail heavyweight Shinsegae Group and Naver Corp. was selected by eBay Inc. as the preferred bidder to purchase its Korean unit.  

From early on, Shinsegae was considered by domestic analysts as the strongest candidate. Shinsegae further bolstered its profile by establishing a formidable alliance with Naver through a 250 billion won ($224 million) share-swap deal in March.

Naver and Shinsegae signed a comprehensive business deal in March. A total of four CEOs were present at the signing ceremony, including the chiefs of Naver, E-Mart and Shinsegae Department Store. 
Naver and Shinsegae signed a comprehensive business deal in March. A total of four CEOs were present at the signing ceremony, including the chiefs of Naver, E-Mart and Shinsegae Department Store. 

Shinsegae-Naver consortium and eBay are still discussing whether the consortium will take 80% or a full 100% of eBay Korea’s shares. Sources report that the price tag for the 100% buyout is around 4.2 trillion won ($3.76 billion), whereas the 80% acquisition is priced at around 3.5 trillion won ($3.13 billion).

Shinsegae Group will pay 80% of the bidding price, while Naver will be funding the remaining 20%. If the deal goes through, Shinsegae’s supermarket chain E-Mart Inc. will succeed in having eBay Korea under its umbrella.


The combined annual transactions of eBay Korea units last year were valued at 20 trillion won ($18 billion), the third largest in the country, after Naver’s 27 trillion won ($24.3 billion) and Coupang’s 22 trillion won ($19.8 billion).

Shinsegae’s e-commerce brand SSG.COM’s annual transactions were only valued at 4 trillion won ($3.6 billion) during the same period.

But with the acquisition, Shinsegae Group will have combined annual transactions of 24 trillion ($21.5 billion), outperforming Coupang.

Shinsegae said it will aim for a higher level of integration between its traditional offline stores and the online platforms. Unlike other major players in the e-commerce sector such as Naver and Coupang, Shinsegae has more than 140 offline E-Mart stores in operation.

The group also plans to offer a membership and payment service that will allow users to enjoy the benefits offered by Naver and Shinsegae platforms in a more convenient way. 

“We will launch a combined membership program that will integrate all the services offered by Naver, Shinsegae Department Store, E-Mart, SSG.COM as well as Gmarket and Auction,” said a Shinsegae Group official.

Gmarket and Auction are South Korea’s two largest open market platforms currently operated by eBay Korea.

Shinsegae insiders say that the eBay Korea acquisition will accelerate the group’s large-scale investments in logistics and delivery systems. After securing better economies of scale with the purchase, Shinsegae will gradually cut fixed costs for more efficient management of the platforms.  

Shinsegae Group is also taking part in the bidding for Korea’s second-largest food delivery platform Yogiyo owned by Germany's Delivery Hero SE.

Delivery Hero has put 100% of Yogiyo on the market in compliance with the conditions put forward by the Korea Fair Trade Commission last year to close its $4.3 billion purchase of Yogiyo's bigger rival, Baedal Minjok, or Baemin.

Some industry analysts note that the Shinsegae-Naver consortium may also face scrutiny from Korea’s antitrust regulator.

While the combined market share of Naver and Shinsegae, even after the acquisition, is less than 50% in the e-commerce sector -- as Naver’s share last year was 18%, eBay’s 12% and Shinsegae’s 3% -- they highlight that the creation of the mega-sized e-commerce alliance having almost triple the share held by Coupang is likely to hurt the basic principles of fair trade.


The US-based eBay entered Korea in 2000 and once had a dominant 70% share of the country’s e-commerce market. But since reaching its highest operating margin of around 20% in 2010, the company has experienced a decade-long decline given competition from its rivals such as Coupang and TMON Inc.

“Shinsegae will be able to create new synergies by applying its know-how, accumulated from running SSG.COM over the past several years, on the larger platforms operated by eBay Korea,” said a retail industry representative.

Write to Chae-yeon Kim and Jun-ho Cha at

Daniel Cho edited this article.

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