South Korean internet giant Naver is buying Poshmark, a US online marketplace for used clothing, for roughly $1.2 billion, the companies said Tuesday.
The deal — worth about $1.6 billion in total when Poshmark’s cash holdings are included, according to Naver — is expected to close by the first quarter of 2023, the firms said.
Naver operates a highly influential search engine and e-commerce platform in South Korea, and is paying $17.90 a share in an all-cash deal.
“Poshmark is a natural fit for our business -– our two companies share a common set of values and vision around content, community and empowerment,” Choi Soo-yeon, chief executive officer of Naver, said in a statement.
“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.”
Poshmark CEO Manish Chandra called the South Korean firm “one of the world’s leading and most innovative and successful internet companies”, and said the transaction delivers “significant and immediate value to our shareholders”.
“As part of Naver, we will benefit from their financial resources, significant technology capabilities, and leading presence across Asia to expand our platform,” Chandra added.
The resale market particularly saw a pandemic-time boom as it prompted those under quarantine to clean out their closets and resell items they no longer wanted.
The deal will allow Naver to “capitalise on the increasing consumer shift in fashion to online re-commerce”, the firms said.
Online clothing resale is an $80 billion market today in the US alone, and is expected to grow annually to $130 billion by 2025, according to Activate Consulting.
The South Korean firm acquired Wattpad, a Toronto-based online storytelling platform, for about $600 million last year.
But its shares were down 8.53 percent on Tuesday afternoon in Seoul.