US e-commerce firm eBay’s board of directors have reportedly approved retail conglomerate Shinsegae as the new owner of eBay Korea, which has been up for sale since last year. Shinsegae Group’s retail affiliate E-Mart and Naver are set to sign an agreement for a joint acquisition. EBay Korea accounts for around 11 per cent of eBay's global sales.

The eBay Korea sale is widely perceived to propel one of the top bricks-and-mortar retailers in South Korea to turn the leading online store, according to media reports from the country.

E-Mart has formed a strategic alliance with Naver, because Shinsegae Department store is scheduled to invest more in mobile delivery application Yogiyo, and acquire the remaining 50 per cent stake in Starbucks. As a result, Naver will offer financial backing for Shinsegae's acquisition of eBay Korea.

Shinsegae in 1999 acquired the operation license from Starbucks, and Emart and the coffee chain in December 2000 established a 50:50 joint venture Starbucks Coffee Korea.

Launched in 2000, eBay Korea grew rapidly and achieved around a $75 million operating profit last year. However, it has witnessed powerful rivals emerge in the South Korean market in the last few years.

Once the acquisition process is completed, Shinsegae will become the largest shareholder of eBay Korea, followed by Naver.

eBay Korea accounted for about 12.8 per cent of the country's total e-commerce market last year. Coupang accounted for 13 per cent and Naver 18 per cent.

Fibre2Fashion News Desk (DS)

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