EBay Wants To Sell Off S Korean Unit

Online marketplace and auction site eBay is looking to unload its South Korean unit, according to a report by Reuters.

The unit includes one of the biggest online marketplaces in the country, called Gmarket. The deal as a whole could potentially be worth $5 billion. A newspaper in the region, The Korea Economic Daily, reported that eBay wants to sell 100 percent of its stake in the company, called eBay Korea.

There are a few large retail companies that could potentially buy eBay Korea, like Lotte Shopping, Shinsegae or Hyundai Department Store Group. Also, private equity fund MBK could potentially be interested.

Gmarket was acquired by eBay in 2009 for around $1.2 billion and was merged with the South Korean company Internet Auction. At the time of the merger, the companies made up 87 percent of the country’s consumer-to-consumer market as well as over 30 percent of the online shopping mall market.

Lately, more competitors have emerged in the space, including the SoftBank-backed startup Coupang, which was founded in 2010 and commands the biggest share of the eCommerce market.

The auction company is also inching closer to selling off its classified advertising business, which could be worth about $10 billion. Potential interested parties include Blackstone Group, TPG, Naspers and German publishing company Axel Springer, among others.

eBay has been considering a selloff of the business since last year, as well as other options like spinning it off and making it a joint operation.

Both Naspers and Axel Springer have classified businesses of their own. eBay used to also own brands like PayPal and StubHub, but sold them when their directives differed from its own.

Both Elliott Management and Starboard Value, two activist hedge funds, have purchased stakes in the company and have been pushing to sell off its ticketing and classified businesses. Both companies have representation on eBay’s board.