Baseball Team, eBay, and Now Starbucks... Jeong Yong-jin's Unstoppable M&A Moves

Aggressive Investment Crossing Industries... "Seeking Opportunities Amid COVID-19 Crisis"
Likely to Continue Affiliate Collaborative Marketing Based on Starbucks Brand Power

[Image source=Yonhap News]

[Asia Economy Reporter Jo In-kyung] Chung Yong-jin, Vice Chairman of Shinsegae Group, is continuing his aggressive investment moves by acquiring shares in eBay Korea and Starbucks Coffee Korea, following the professional baseball team SSG Landers and the online fashion platform W Concept. The investment amount has exceeded 4 trillion won this year alone, crossing various industries.

Shinsegae Emart announced on the 27th that it signed a contract to additionally acquire a 17.5% stake in Starbucks Coffee Korea from the U.S. Starbucks headquarters for 474.2 billion won. Once the contract is completed, Emart's stake in Starbucks Korea will increase from the existing 50% to 67.5%, making it the largest shareholder.

Despite the impact of COVID-19, Starbucks Korea has continued its growth through methods such as 'Siren Order (remote ordering)' and 'Drive-Thru,' with last year's sales reaching 1.9284 trillion won and operating profit amounting to 164.4 billion won.

As Shinsegae Group solidifies the domestic business rights of Starbucks, which has powerful brand power, it plans to strengthen synergy through collaborative marketing with group affiliates. They have previously attempted several collaborative marketing efforts by introducing goods combining SSG Landers and Starbucks.

This additional acquisition of Starbucks Korea shares is also interpreted as being linked to Shinsegae Group's business area expansion.

Earlier this year, Shinsegae Group acquired the professional baseball team SK Wyverns from SK Telecom for 100 billion won, transforming it into SSG Landers, followed by acquisitions of W Concept (265 billion won) and an 80% stake in eBay Korea (3.44 trillion won). Including this Starbucks Korea acquisition, the group has invested approximately 4.28 trillion won in M&A this year alone.

An official from the distribution industry explained, "This aggressive move by Shinsegae reflects Vice Chairman Chung Yong-jin's determination to turn the crisis into an opportunity and become the strongest player in distribution," adding, "they are strengthening online capabilities from the existing offline-centered business structure and sparing no investment in M&A to create synergy with existing affiliates."

However, concerns remain about financial burdens or deterioration of financial structure due to excessive M&A. Since last year, Shinsegae has secured trillions of won in investment funds through asset liquidation such as store sales.

A Shinsegae Group official said, "As we stated during the acquisition of eBay Korea shares, we have been strategically reallocating group assets centered on real estate for several years to proactively and actively respond to the rapidly changing business environment," adding, "We will invest the funds prepared in future businesses."

This content was produced with the assistance of AI translation services.