Naver, South Korea's leading Internet company, is reportedly in talks with Insung Data, the parent company of LOGiAll, the country's leading delivery agency service provider.
LOGiAll currently holds the largest market share in South Korea's delivery agency market. During the COVID-19 pandemic, the company recorded about 10 million transactions in March this year.
As a result, the total market size of the delivery agency industry reached KRW 7 trillion (US$5.9 billion) last year.
Initially, Insung Data hired NH Investment & Securities to manage the management rights sale.
However, after the pre-bid and primary bid failed to meet expectations, the company shifted its strategy to attracting investment.
Naver's interest in the delivery agency business can be attributed to its aggressive expansion from advertising to e-commerce.
This year, the company has invested in vertical logistics startups to build a logistics value chain for e-commerce.
Investing in delivery-related verticals is new for Naver. In July 2017, the company invested KRW 24 billion in MeshKorea and KRW 35 billion in Woowa Bros.
At the time of investment in Woowa Bros., Naver agreed not to enter the supply market for one year. After one year, Naver sold its shares to Delivery Hero.
LOGiAll's accumulated data from 19 years in the delivery agency business will likely be a significant attraction for Naver.
In addition, the company's expertise and systemic perspective, combined with its market-leading position in South Korea, make it an attractive investment opportunity for Naver as it continues expanding its e-commerce and logistics footprint.