Shinsegae affiliate SSG.COM secures Olympus as new financial investor

The $818 million deal will allow Affinity Equity Partners and BRV Capital Management to exit from their SSG.COM investment

SSG.COM, the e-commerce brand of Korea's retail giant Shinsegae

Jiyoon Yang 1

2024-11-14 19:34:30 yang@hankyung.com

Corporate restructuring

Korean retail giant Shinsegae Group’s online shopping mall operator SSG.COM has secured Olympus, a special purpose company created by Korean banks and securities firms, as its new financial investor.

E-Mart Inc. and Shinsegae Inc., major shareholders of SSG.COM, said in a regulatory filing on Thursday that Olympus will acquire a 30% stake in SS.COM, or 1.32 million shares, from two existing financial investors – Affinity Equity Partners and BRV Capital Management.

The stake is worth 1.15 trillion won ($818 million).

The transaction, to be completed on Nov. 26, will allow Affinity Equity and BRV Capital to exit from their investment in SSG.COM.

Olympus is a special-purpose investor created by six local banks, including state-run Korea Development Bank and Shinhan Bank, and four brokerage firms, including NH Investment & Securities Co.

Shinsegae is Korea's leading retail group

The two private equity firms each own a 15% stake after together injecting 700 billion won in 2019 and an additional 300 billion won in 2022 under put option contracts.

They invested in SSG.COM on the condition that the e-commerce platform’s gross merchandise value (GMV) surpass 5.16 trillion won by 2023 or be eligible for an initial public offering before their put option contracts expire on May 1, 2024.

As Shinsegae failed to meet those requirements, the two financial investors asked the retail giant to find another investor to replace them.

Shinsegae later promised to guarantee their exit.

E-Mart is the supermarket brand of Shinsegae Group

E-MART’S Q3 EARNINGS

Meanwhile, E-Mart on Thursday reported its third-quarter results.

The company said its July-September quarter operating profit reached 111.7 billion won on a consolidated basis, up 43.4% from a year earlier. The latest figure marks the highest since the first quarter of 2021.

On a standalone basis, its operating profit was 122.8 billion won, the highest in four years.

Third-quarter sales stood at 4.67 trillion won, up 5.3% from a year earlier.

E-Mart also announced a 100 billion won capital injection into its convenience store subsidiary, E-Mart24 Inc., to support its expansion and secure additional investment capacity for new store openings.

Write to Jiyoon Yang at yang@hankyung.com

In-Soo Nam edited this article.