Anne Stych, Staff Writer, Bizwomen
South Korea’s largest internet company Naver Corp. has acquired online fashion resale marketplace Poshmark Inc. (Nasdaq: POSH) for $1.2 billion.
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, and will be funded with Naver’s cash balances and other existing financing sources.
“The combination will create the strongest platform for powering communities and re-fashioning commerce,” said Choi Soo-Yeon, chief executive officer of Naver. “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.”
Poshmark will become a standalone U.S. subsidiary of Naver but will continue to operate under its existing brand. CEO Manish Chandra and Poshmark’s current management team will continue to lead the brand from its headquarters in Redwood City, California.
The company also will maintain its existing employee base, Poshmark said.
Chandra called the sale “a highly compelling opportunity for our employees, who will benefit from being part of a larger, global organization with shared values and complementary strengths.”
He said that Poshmark will benefit from Naver’s financial resources, technology capabilities and presence across Asia and that the transaction will deliver “immediate value” to shareholders, who will receive $17.90 per share in cash.
Naver provides a platform for bloggers, digital creators of stories (Wattpad) and comics (Webtoons), is home to the longest-standing online community in Korea, with more than 36 million monthly users. It also hosts interest groups including K-Pop fan community Weverse, which is jointly owned with band BTS’ management company.
The company said active users spend an average of approximately 25 minutes a day buying and selling apparel online.
Naver said the addition of Poshmark will allow it to capitalize on the increasing consumer shift in fashion to online re-commerce, which is an $80 billion market today in the U.S. alone, and is expected to grow by 20% annually to $130 billion by 2025.
Founded in 2011 by Chandra and Tracy Sun, Poshmark went public via an initial public offering in early 2021 and currently has more than 80 million registered users. Last year, the company generated approximately $2 billion in gross merchandise value with a primary demographic of millennials and Gen Z users.
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