The South Korean internet firm has pulled out of the auction for eBay’s Korean arm, meaning its ally Shinsegae will pursue the estimated 4.4 trillion won ($3.9 billion) majority stake solo, The Korea Times reports.
“Naver considered acquiring a partial stake in eBay Korea to strengthen the company’s business competitiveness,” the web portal said in a disclosure on Tuesday. “However, Naver decided not to participate in the acquisition process.”
Sources quoted by The Korea Times revealed that eBay’s board approved Shinsegae as the sole candidate for the acquisition of its Korean subsidiary, which it was hoping to sell for around 5 trillion won ($4.4 billion).
Naver’s decision may have been taken due to concerns over market monopoly the company could face, as the deal would have to be approved by the Korea Fair Trade Commission (KFTC), the country’s top antitrust regulator, but company officials declined to comment on the firm’s reasons for its withdrawal.
While The Korea Times writes that Shinsegae asked Naver to contribute 1 trillion won ($880.9 million) to the bid and its withdrawal will put pressure on Shinsegae to secure financing, Pulse News reports that Shinsegae has ample support from the lenders and brokerages looking to back their bid.