Shinsegae enters $221m share swap deal with portal operator Naver

The two companies agreed to collaborate in a meeting last January.

Shinsegae Group and South Korea's portal operator Naver have agreed to a share swap deal valued at $221m (KRW250b) amidst intensifying competition in the country’s online retail sector, Yonhap reported based on a bourse filing.

Under the agreement, Naver will buy $132.69m (KRW150b) worth of stocks in Shinsegae's discount store chain operator E-Mart to own 2.96% and purchase $88.46m (KRW100b) worth of stocks in fashion retailer Shinsegae International to own 6.85%.

In return, E-Mart and Shinsegae will purchase $221.15m (KRW250b) worth of Naver shares to hold a combined 0.4%.

The two companies warmed ties after Shinsegae Group vice chairman Chung Yong-jin and Naver co-founder Lee Hae-jin agreed to collaborate in the e-commerce sector during a meeting in January.

The latest agreement comes as competition in South Korea's online retail sector is set to intensify after Coupang's debut on the New York Stock Exchange last week.

Read: Weekly News Wrap: Burner phone sales surge in Hong Kong's shops; Coupang surges to $109b in US debut