Naver and Shinsegae Forge Alliance to Keep Coupang in Check

Naver has forged an alliance with Shinsegae Group.

Korean e-commerce companies are moving to forge new alliances against Coupang.

Naver, which started as an Internet search company and expanded its scope to news, content, finance, and shopping, has forged a strong alliance with Shinsegae Group, a Korean distribution and retail giant. The two companies are expected to work together to strengthen their distribution and logistics businesses.

Naver announced on March 16 that it has decided to buy shares of Shinsegae International and E-Mart to strengthen its business partnership with Shinsegae Group. Naver will exchange shares worth 150 billion won and 100 billion won with E-Mart and Shinsegae International, respectively. The stock exchange will be made on March 17. Through this, Naver and Shinsegye plan to further strengthen their partnership and promote a combination of online and offline businesses.

Kakao is a strong candidate to take over eBay Korea, the third largest e-commerce company which is up for sale. Kakao runs its e-commerce business in the form of the “gift corner” in the Kakao Talk messenger app. If it acquires eBay Korea, which recorded 20 trillion won worth of transactions in 2020, it will be able to immediately become a major e-commerce company that can compete with Naver or Coupang. However, Kakao is not quite sure about the future growth of Auction and Gmarket, the two main online shopping malls of eBay Korea. Moreover, the price of eBay Korea, estimated at 5 trillion won, is too high for it.

Coupang, which made its successful debut on the New York Stock Exchange, is a formidable threat to other Korean distribution companies as it has raised about 5 trillion won through the listing.