Emart Expands Its Scale Through eBay, Remaining Challenge Is External 'Growth'

E-commerce Market Share Expected to Rise to 15%
Qualitative Growth Key to Increasing Corporate Value
"Resolving Acquisition Uncertainty Is Positive but Future Business Strategy Needs Monitoring"

The appearance of eBay Korea headquarters in Gangnam-gu, Seoul on the 17th. / Photo by Mun Ho-nam munonam@

[Asia Economy Reporter Minwoo Lee] Emart has finalized the acquisition of eBay Korea. Although the e-commerce market share will increase to 15%, experts analyze that qualitative growth, rather than simple expansion, is essential for the corporate value to rise.

On the 27th, Kyobo Securities diagnosed that the challenge for Emart's acquisition of eBay is growth, not just expansion in scale. Researcher Soyeon Jeong of Kyobo Securities stated, "For long-term corporate value increase, the qualitative growth driven by synergy from the integration of e-commerce businesses will be more decisive than mere market share expansion. However, since it is expected that Gmarket and Auction of eBay and Emart’s SSG.com will be operated separately after the acquisition, the short-term growth in Gross Merchandise Volume (GMV) of each individual platform will be an important investment indicator."

Previously, Emart announced it would acquire an 80.01% stake in eBay Korea for approximately 3.44 trillion KRW. It plans to use about 2 trillion KRW from existing cash and asset sales proceeds, with the remainder financed through acquisition loans. As a result, the combined GMV of eBay Korea and Emart’s SSG.com will grow to around 24 trillion KRW, corresponding to a 15% share of the e-commerce market.

Through this acquisition, SSG.com is expected to drive customer attraction and GMV growth via a partnership with NAVER, while Gmarket and Auction will leverage marketing strategies based on approximately 6 million Smile Club members. The logistics infrastructure is also anticipated to expand aggressively to provide integrated logistics services?including storage, packaging, delivery, and inventory management?covering both Emart’s direct purchase commerce and eBay’s open market fulfillment.

Researcher Jeong concluded, "While the resolution of acquisition uncertainties over the past three months is positive for stock prices, it is necessary to take a conservative approach by closely monitoring post-acquisition business strategies and directions."