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The Deep Dive

The butterfly effect: How the W Concept takeover stirred up Korea's fashion industry

Behind the scenes of the 265 billion won deal poised to revive Shinsegae's online fashion business

By Jun 22, 2021 (Gmt+09:00)

The butterfly effect: How the W Concept takeover stirred up Korea's fashion industry

“Just give us three weeks. We’ll offer a price by then.”

This conversation took place in early March. A senior executive from retail giant Shinsegae Group was visiting IMM Private Equity to express its intent to acquire W Concept -- the country's No. 1 women's fashion platform. It was a pivotal moment, a foreshadowing of W Concept's new home.

But the timing wasn’t great. IMM PE and Korea's leading fashion platform Musinsa were near wrapping up negotiations over the W Concept deal. Not to mention, IMM PE was somewhat doubtful about Shinsegae’s approach since the company had seemed lukewarm ever since the bid kicked off at the end of last year.

To IMM PE’s surprise, Shinsegae did not waver and made clear its intent to chase after W Concept – reflecting the firm will of Chung Yong-jin, the vice-chairman of Shinsegae Group, who was determined to buy the fashion platform.

Three weeks later as promised, Shinsegae participated in the bid via its e-commerce arm,, thus becoming the highest bidder and offering conditions far better than the other bidders.

From thereon the deal progressed swiftly without any hiccups under the leadership of Kang Heui-seok, the chief executive of Shinsegae’s affiliate Emart Inc. The entire process took fewer than three months from their first meeting to the deal's closing.

“Shinsegae affiliates joined forces and moved the deal along with a quick decision-making process. It showed me that a substantial change was taking place within the group,” said Son Dong-han, the chief executive of IMM PE.


Initially, Shinsegae wasn’t seen as a strong contender in the race to acquire W Concept. The retail giant had been passive in the M&A scene without any notable deals for the past few years.

But this began to change from late 2020. Earlier this year, Shinsegae acquired a 100% stake in SK Group’s baseball club, SK Wyverns, for 130 billion won and just a month later followed with the W Concept deal valued at 265 billion won ($234 million).

Shinsegae made a winning move of acquiring W Concept to hold onto its leading position in the online and offline retail market. In particular, the domestic online fashion market is valued at around 60 trillion won – a market too big to be dismissed.

Despite its competitive edge in fresh produce and daily necessities,'s fashion segment had been left unattended. Now with W Concept under the Shinsegae umbrella, will be able to boost its fashion lineup and secure the coveted millennials and Gen Zers, collectively known as MZers.

The butterfly effect: How the W Concept takeover stirred up Korea's fashion industry

W Concept is one of the big five online fashion apps in Korea, targeting young women in their twenties and thirties with an offering of stylish and contemporary brands of clothing and shoes. Some 6,000 brands are available on the platform.

A noteworthy aspect of the deal is that Shinsegae will maintain W Concept's management – an extremely rare move since most large business groups or PE firms tend to replace the management after acquiring a company.

But Shinsegae determined that it’d be best to let the existing management continue handling W Concept’s operations to enhance the group's competitiveness in the e-commerce fashion sector.

“It’s not an easy decision to retain the existing management post-acquisition. It goes to show that Shinsegae is departing from the old ways of thinking and focusing on ways to provide full support to e-commerce specialists,” said IMM PE’s Son.


Shinsegae’s takeover of W Concept has stirred up the domestic fashion industry, prompting companies' rush to secure a footing in the fashion e-commerce scene.

Just a month after the Shinsegae-W Concept deal, Musinsa announced plans to acquire the No .2 women's fashion platform 29CM and its parent company StyleShare, a beauty and fashion-tip sharing social media platform.

Also, Korea's top mobile messaging app operator Kakao Corp. purchased the popular fashion platform Zigzag while platform giant Naver Corp. bought a minority stake in the fashion app Brandi.

The butterfly effect: How the W Concept takeover stirred up Korea's fashion industry

For now, Musinsa remains in the lead of Korea's online fashion industry as it has the most users. But it's uncertain if the company will be able to hold onto its position since many large business groups, such as Shinsegae, Kakao and Naver, are ramping up their online fashion investments.

These big companies' ultimate goal is the same: to gain footing in the e-commerce industry by securing loyal and precious consumers -- notably trend-sensitive MZers who are active fashion platform users.

Write to Chae-yeon Kim at

Danbee Lee edited this article.

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