Shinsegae Group’s ambitious acquisition of the local unit of eBay is set to create a retail giant that will rival the existing top players.
With its latest acquisition, Shinsegae is set to jump into the competition between Naver and Coupang which has dominated the local e-commerce market.
Shinsegae’s offline discount chain E-mart signed an agreement to purchase 80 per cent of eBay Korea’s shares for US$3.04bn. Despite the higher-than-expected acquisition cost, Shinsegae is making a bold bet that the combination of its online and offline sales channels merging with eBay Korea’s open market platforms will translate into bolstered competitiveness. Neither Naver nor Coupang have an offline sales channel.
The latest deal is also set to result in the consolidation of top players and widen the gap with smaller players in the market. With the acquisition, Shinsegae is expected to become the No. 2 player in the domestic e-commerce market after Naver.
