Naver Completes Acquisition of Poshmark... Full-Scale Global Expansion Begins

Poshmark Shareholders Approve... Acquisition to Complete Early Next Month
Acquisition Accelerated Ahead of Plan... Directly Addressing Market Concerns

[Asia Economy Reporter Yuri Choi] Naver has crossed the final hurdle in acquiring Poshmark, the No.1 fashion secondhand trading platform in North America. The funds have been secured, and approval from Poshmark shareholders has been obtained. This is to advance the final acquisition, originally scheduled for April next year, to January. Naver plans to quell market concerns about the Poshmark acquisition and accelerate its global market expansion.

Merger agenda approved at shareholders' meeting... Acquisition to be completed in early January

According to industry sources on the 29th, Poshmark held a shareholders' meeting on the 27th and passed the merger agenda with Naver. Despite controversies over a low-price sale and shareholder lawsuits, 99% approval was achieved. U.S. law firms had launched investigations into the acquisition price, claiming the company, once valued over $100 per share, was being sold at $17.9 per share, and some shareholders filed lawsuits alleging insufficient information was provided about the merger.

Naver also finalized securing acquisition funds by selling half of its stake in VFX specialist Giant Step for 15.7 billion KRW. It plans to use about 1 trillion KRW in cash holdings and borrowings. The acquisition process is expected to be completed in early January. This comes three months after Naver announced in October that it would acquire Poshmark for $1.6 billion. The plan to complete the acquisition by April next year has been advanced by about three months.

Acquisition price likely to be lower than expected... Full-scale global C2C market entry

The reason Naver is advancing the acquisition timing is to alleviate market concerns. The market criticized the purchase of Poshmark at a high price amid global economic uncertainties. There were also worries that Poshmark’s shift to losses this year would negatively impact Naver’s performance. Analysts interpret that Naver is aiming to resolve uncertainties by closing the acquisition early. After completion, the goal is to quickly improve Poshmark’s profitability through marketing efficiency and additional advertising.

Naver plans to aggressively target the global peer-to-peer (C2C) market, including North America, immediately after the acquisition. This year, Naver has invested over 3 trillion KRW in secondhand trading and resale platforms, clearly signaling its intention to make the C2C market a new growth engine. Through this, it aims to attract the MZ generation (Millennials + Generation Z), expanding beyond the 30s to 50s users who mainly use its search services.

If the acquisition is completed next month, foreign exchange gains are also expected. At the time of the acquisition announcement, Naver set the acquisition price at 2.3 trillion KRW based on the won-dollar exchange rate of 1,434 KRW. On the 28th, the exchange rate dropped 11.4% to 1,267 KRW. Based on the current exchange rate, Naver stands to gain about 300 billion KRW.