Big news! South Korean e-commerce giant Naver and retail giant Shinsegae form a "250 billion" alliance

Since last year, there have been rumors in the Korean industry that Naver will form an alliance with the Korean retail giant Shinsegae Group, but there has been no official response from the two companies. Now this rumor has become a fact!

Shinsegae Group said on the 16th: "At the JW Marriott Hotel, we met with E-Mart CEO Kang Hee-seok, Shinsegae Department Store CEO Cha Jung-ho, Naver CEO Han Sung-sook, Naver Financial Representative Choi In-hyuk and other key personnel from the two companies. The two sides will cooperate in all aspects such as business, logistics, membership and win-win partnership, and have officially signed an alliance contract. "

To this end, the two companies will exchange shares worth 250 billion won, of which E-Mart under Shinsegae Group will invest 150 billion won and Shinsegae Department Store (SSG.com) will invest 100 billion won. They decided to further strengthen the unity and mutual trust between the two parties by exchanging shares with Naver .

E- Mart plans to exchange 824,176 shares (2.96% of the shares) of its own company for 389,106 shares (0.24% of the shares) of Naver , while SSG.com plans to exchange 488,998 shares (6.85% of the shares) for 259,404 shares (0.16% of the shares) of Naver .

Through this business agreement, Shinsegae Group and Naver plan to strengthen cooperation in various fields of the distribution industry, such as expanding online and offline commerce, exploring new services based on new technologies, and expanding the scale of small and medium-sized sellers.

Shinsegae Group and Naver have 20 million users , while Naver has 54 million. The cooperation between the two companies will ensure that the alliance includes a customer base that covers almost the entire Korean population , 450,000 sellers , a nationwide logistics network that can deliver immediately, on the same day, and at midnight , and more than 7,300 offline locations .

As an IT giant, Naver has rapidly added stores and users thanks to its excellent accessibility, but it does not have its own distribution network, so its delivery competitiveness is poor and it lags far behind its biggest rival Coupang in terms of channels for purchasing fresh food .

However, E-Mart, the No. 1 supermarket chain in Korea , has excellent purchasing capabilities for fresh food and other products, and has logistics capabilities based on physical stores. However, the transaction volume of SSG.com, a comprehensive online mall under the Shinsegae Group, is around 4 trillion won, and it has not been able to expand its scale.

"Combining Shinsegae Group's online and offline distribution and logistics capabilities with the Naver platform and artificial intelligence (AI) technology will not only provide customers with the highest preferential treatment, but also establish a new ecosystem that can grow together with partners such as small and medium-sized sellers." said a relevant person in charge of Shinsegae Group.

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