South Korean internet giant
The companies said they are paying Boshmark $17.90 per share in cash. Poshmark priced its initial public offering at $42 in January 2021 and shares more than doubled on their first day. The The stock fell Monday ended at $15.57.
The transaction values Boschmark at about $1.6 billion, including about $580 million in cash reserves, Naver said. According to FactSet, Poshmark’s peak market capitalization was $7.3 billion when it hit the day it went public.
Poshmark looks and behaves like Instagram, encouraging sellers to give and receive comments and “likes” and allowing users to follow their favorite sellers. similar
Sellers photograph their own items and sell them directly. Poshmark charges fees for selling on its marketplace, but does not hold any inventory.
Given the Covid-19 pandemic An incentive for online shopping, Boshmark’s losses have widened and its revenue growth has slowed this year. After reaching $90.9 million in revenue in the March quarter, Poshmark forecast revenue for the June quarter fell to $89.1 million and will come in between $85 million and $87 million in the September quarter.
Naver is South Korea’s largest internet portal and serves as a bigger search engine than Google domestically. It offers mobile payments and online shopping. Outside of Korea, Naver is behind the messaging app Line and is a major operator of webtoons, or digital comics read on online and mobile platforms. In 2021, the South Korean company acquired Toronto-based storytelling platform Wattpad for $600 million.
The Poshmark transaction is expected to close in the first quarter of 2023, the companies said. The Redwood City, Calif., company will become Naver’s exclusive U.S. subsidiary. Boshmark’s founder and chief executive Manish Chandra and his team will continue to lead the company.
Founded in 2011, Poshmark bills itself as a way to marry sustainable commerce with social media and claims it has more than 80 million registered users. The number of active buyers who bought on the site in the last 12 months was about 8 million last quarter, the company said. It is Facing competition from
Real real Inc.,
Facebook Marketplace and other marketplaces allow people to buy or sell used items.
The combination will help Boshmark expand in Korea and other parts of Asia, the companies said. Boschmark currently offers its app to users in the US, Canada, Australia and India. This will give Naver a big foothold in the US market.
Naver expects the deal to provide both companies with total savings of $30 million. Naver’s chief financial officer, Kim Nam-sun, said in a conference call that Poshmark expects gains from cutting unnecessary costs and gaining access to Naver’s direct-to-commerce solutions and other technologies.
Shares of Naver fell nearly 9% on Tuesday following news of the Poshmark acquisition.
At a press conference in Seoul, Naver CEO Choi Soo-yeon downplayed the stock’s decline. The purchase was made at a very reasonable price, and he expressed confidence that the so-called customer-to-customer marketplace in which Poshmark operates will continue to grow in the coming years.
With the acquisition, Naver expects Boschmark to improve its marketing campaigns and pursue partnerships with the South Korean company’s own offerings. For example, HYBE Co., the back agency of boy band BTS. Ms. Choi cited Weverse, an online marketplace for selling K-pop, in collaboration with
“We will continue to pursue new projects and study better ways to create service integration between the two companies,” said Ms. Choi.
Write to Jeong Sohn at firstname.lastname@example.org
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