Shinsegae chief: buyout of 11st.com from SK Group one option

South Korean retail giant Shinsegae is looking into acquisition of the country’s leading online shopping mall 11st.com run by SK Group as “one of many options” to strengthen online business, said its chief.

Shinsegae Group Vice Chairman and heir Chung Yong-jin on Thursday confirmed the rumor that the conglomerate was bidding for 11st.com, which has also been in talks with Lotte Group for stake sale and partnership.

“The acquisition of 11.st is one of many scenarios,” he told reporters during the opening event of Starfield Goyang shopping complex. “We will be ready to make a surprising announcement before the year ends.”

11st.com is one of Korea’s leading online shopping mall. Its operator SK Planet Co. which plans to either sell off the e-commerce platform or draw mass-scale investment reportedly has contacted the country’s top retailers Lotte and Shinsegae. There also have been speculations that SK Planet would spin off 11st.com and turn it as a joint venture with either Lotte or Shinsegae.

Last year, 11st.com commanded a transaction volume of 6.8 trillion won ($6 billion), and Shinsegae online shopping mall’s transaction was estimated at 2 trillion won. If two are merged, they would have a greater chance to stand shoulder to shoulder with market leader eBay Korea, which registers annual transaction volume of nearly 14 trillion won.

But some market watchers predict Shinsegae may head to another e-commerce operator for partnership or ramp up its own online mall due to little progress in talks with SK Planet.

Separately on the same day, Chung unveiled a plan of expanding the group’s overseas operation. The group is taking steps to withdraw its business from China with a plan to complete the exit by the end of this year. Instead it will branch out to the Southeast Asian market including Vietnam, Cambodia, and Laos, said Chung. He also hinted at delivering news on overseas business early next year.

[ㄏ Maeil Business Newspaper & mk.co.kr, All rights reserved]