Shinsegae Co. signage is displayed outside one of the company’s department stores in Seoul, South Korea.
SeongJoon Cho/Bloomberg
South Korean discount chain E-Mart, a unit of tycoon Chung Yong-jin’s retail conglomerate Shinsegae, has agreed to form a joint venture in South Korea with Chinese e-commerce giant Alibaba.
“Through a joint venture that combines our domestic distribution know-how and Alibaba’s e-commerce/IT capabilities, we will expand the sales channels for domestic sellers’ products to be sold and distributed worldwide on a global platform and pursue mutual benefits through this,” E-Mart said in a regulatory filing Thursday. The news sent shares of E-Mart up 5.45%, giving it a market cap of 2.1 trillion won (about $1.4 billion).
The new joint venture company, called Grand Opus Holding, will be launched in 2025 and will be owned equally by E-Mart subsidiary Apollo Korea and Alibaba’s AliExpress International (Netherlands).
“The company will work with Alibaba to expand Gmarket’s services and improve customer experience,” E-Mart’s filing said. Gmarket is Shinsegae’s online shopping platform.
Gmarket’s CEO, Danny Chung, joined the company in July from Alibaba where he was Korea general manager. Last year, Gmarket logged revenue of 1.2 trillion won and a loss of 11 billion won.
The South Korean e-commerce market is one of the largest and most competitive in the world. Other players in the cutthroat space include billionaire Bom Kim’s Coupang, PDD Holdings’ Temu and Alibaba’s AliExpress.
E-Mart obtained Gmarket as part of its $3 billion acquisition of eBay’s South Korean business in 2021. That year, Shinsegae also acquired South Korean fashion app W Concept from Seoul-based IMM Private Equity for 265 billion won.
Shinsegae’s Chung was promoted to chairman from vice chair in March. His mother, Lee Myung-hee, is the fifth daughter of Samsung founder Lee Byung-chull, who bequeathed her the Shinsegae group when he divided his empire between his children before his death in 1987.
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