Naver Corp has bolstered its presence in the South Korean mergers and acquisitions (M&A) market despite the fall in overall dealmaking due to Covid-19, as the internet portal giant looks for investment opportunities to expand its business reach.
In November Naver participated in a $70 million series C financing for Bucketplace, which operates home interior platform O-House, together with investment firms BOND, IMM Investment and Mirae Asset Venture Investment, and bought 10.3% of Insung Data – owner of food delivery services app Logiall – for about 35 billion won ($32 million).
The company also announced share swaps in October with CJ Group’s affiliates as part of efforts to strengthen its position in the ecommerce and content space. It invested 300 billion won in CJ Logistics, 150 billion won in entertainment company CJ E&M and 150 billion won in drama production company Studio Dragon.
In the same month Naver absorbed JAM LIVE, the live commerce service spun off from the company’s camera app developer subsidiary SNOW, to create synergy with its live shopping service launched earlier this year. The company also announced a partnership this summer with SM Entertainment, a leading entertainment company that represents many K-pop stars, and then invested in SM’s affiliates Mystic Story and SMEJ Plus, as it pushed for online content business.
According to its financial statements, Naver spent more than 700 billion won on 37 deals to buy stakes in companies at home and abroad in the nine months through September. For the whole year, the amount is expected to exceed 1 trillion won, a large increase from its investments of 120 billion won in 18 deals in 2019 and 460 billion won in 51 deals in 2018.
Naver’s recent investing spree coincides with efforts by the company to recruit M&A experts. In August, the new executive officer of its M&A team was named as Namsun Kim, who previously worked at Macquarie Korea Asset Management (MKAM). Kim led investments in ADT Caps and LG CNS at MKAM and since his arrival Naver has been more active in acquisitions and has focused on larger deals.
Naver is reportedly continuing efforts to enhance its M&A team by recruiting more specialists in the field, which is a sign that the company will probably remain active in the M&A market in the coming year. (Reporting by Hee-yeon Han)