Naver, the South Korean internet company, announced that it is set to acquire Poshmark, a social e-commerce marketplace for new and secondhand apparel, for $1.2B in cash.
The Korean company will buy all of Poshmark’s shares for $17.90 each, representing a premium of 15% to Poshmark’s closing stock price as of October 3, 2022, a 34% premium to the 30-day volume weighted average price, and a 48% premium to the 90-day volume weighted average price of Poshmark’s shares.
The transaction, which was unanimously approved by both Naver’s and Poshmark’s Boards of Directors, is expected to close by the first quarter of 2023, subject to approval by Poshmark stockholders and the satisfaction of certain other customary closing conditions.
Upon completion of the transaction, Poshmark would become a standalone US subsidiary of Naver. It would continue to be led by Chief Executive Officer Manish Chandra and his management team.
Poshmark will continue to operate under its existing brand and maintain its employee base, Poshmark community, and headquarters in Redwood City, California.
How this acquisition benefits Naver?
The addition of Poshmark will expand and diversify Naver’s search-driven e-commerce business into the global secondhand C2C market for fashion.
Further, Poshmark will instantly benefit from Naver’s deep technology stack and AI-based capabilities, including its smart lens image recognition and search technologies.
These capabilities will allow Poshmark to offer a new search and shopping experience by integrating Naver’s shopping search engine, which allows users to enter additional search keywords according to their preferences on colors, designs, and materials.
Poshmark will benefit from Naver’s global presence in high-growth markets, particularly Korea. In addition, this acquisition provides Naver with an enhanced foothold in the US, expanding its international profile. It has steadily increased both organically and through investments over the past 20 years.
Oldest surviving company
Founded in 1999, Naver is Korea’s oldest surviving and country’s largest internet company. The company operates Korea’s search engine and largest e-commerce platform, providing fintech services, digital content, and cloud services to a global community.
Choi Soo-Yeon, Chief Executive Officer of Naver, says, “The combination will create the strongest platform for powering communities and re-fashioning commerce. Poshmark is the definitive brand for fashion in the United States that provides a social network for buying and selling apparel. Naver’s leading technology in search, AI recommendation, and e-commerce tools will help power the next phase of Poshmark’s global growth.”
She adds, “Poshmark is a natural fit for our business – our two companies share a common set of values and vision around content, community, and empowerment. Bringing Naver and Poshmark together will immediately put us at the forefront of creating a new, socially responsible, and sustainable shopping experience designed around sellers of all sizes and interests – from individual and influencer sellers to professional sellers, brands, and specialty boutiques – and a large, loyal, and highly engaged social community. We are excited to work closely with Manish and his talented team to create lasting value for all our stakeholders.”
Poshmark is a social marketplace for new and secondhand styles for women, men, kids, pets, homes, and more. The company has a community of more than 80M registered users across the US, Canada, Australia, and India.
Manish Chandra, Founder and Chief Executive Officer of Poshmark, says, “The opportunity to join forces with Naver – one of the world’s leading and most innovative and successful internet companies – is a testament to the strength of our brand, operating model, and what we’ve built over the last decade with our talented team and amazing community. Our industry continues to evolve at a rapid pace, and we are excited to continue to lead the future of shopping by providing our community with an unparalleled experience that is simple, social, fun, and sustainable.”
He adds, “This is a highly compelling opportunity for our employees, who will benefit from being part of a larger, global organization with shared values and complementary strengths. This transaction also delivers significant and immediate value to our shareholders. Longer term, as part of Naver, we will benefit from their financial resources, significant technology capabilities, and leading presence across Asia to expand our platform, elevate our product and user experiences, and enter new and large markets. I look forward to partnering with Naver as we take our company into its next growth phase.”