SK Square Sells 11st to SK Planet: "Leap Forward Through OK Cashbag-E-commerce Synergy"

[Korea Financial Times, Park seulgi] SK Square is selling 11st to SK Planet. Through this transaction, it will repay the entire investment of financial investors (FIs). Two years after SK Square forfeited its call option in 2023, the situation has reached closure. SK Planet and 11st have reinforced their determination to leap forward through synergies between their core businesses of OK Cashbag and e-commerce.

According to the Financial Supervisory Service's electronic disclosure system on the 29th, SK Square disclosed that it will sell 100% of its management stake in 11st to SK Planet for approximately KRW 660.7 billion. SK Square held a board meeting on this day and finally passed a resolution to sell 100% of its management stake in 11st to SK Planet.

SK Planet plans to pay a total of KRW 467.3 billion to 11st's financial investors by the end of the year as consideration for acquiring 11st shares. As a result, 11st's financial investors will recover their past 11st investment by selling all their 11st shares, including SK Square shares, to SK Planet through the exercise of drag-along rights.

The funds for acquiring 11st shares for this transaction will utilize SK Square's capital increase and SK Planet's own funds. Additionally, SK Square's stakes in Sparkplus (shared office), Haegin (gaming), and Korbit (virtual asset exchange) will be reorganized under SK Planet. Going forward, SK Planet plans to further strengthen its OK Cashbag business in connection with these operations.

With SK Planet's acquisition of 100% of 11st shares, the governance structure changes to SK Square-SK Planet-11st. In other words, 11st becomes a 100% subsidiary of SK Planet. Previously, SK Square had SK Planet and 11st as separate subsidiaries.

SK Planet and 11st plan to focus on synergies between their respective core businesses of OK Cashbag and e-commerce, transforming into industry-leading mileage and commerce companies.

Through this reorganization, SK Planet will significantly expand mileage accumulation and usage points based on 11st's commerce platform, further enhancing OK Cashbag's competitiveness. The company also plans to combine OK Cashbag with 11st's 11pay (simple payment) to establish a "payment→point accumulation" service, and strengthen sales within the OK Cashbag app and point utilization marketing along with 11st's gifticon business. 11st Gifticon is a business that issues and sells mobile gift certificates to general consumers and corporate customers.

At the same time, 11st revealed its vision to evolve into "AI-based contextual commerce." It aims to create commerce where AI understands customers' purchasing patterns and preferences multidimensionally and recommends customized products. 11st and SK Planet's strategy is to integrate both companies' existing AI and data technology capabilities to grow 11st into a differentiated commerce platform providing new consumption experiences.

SK Planet and 11st stated they will continue their current performance improvement trend by pursuing profitability-centered sales growth.

SK Square-SK Planet-11st described this reorganization as "the optimal solution for win-win outcomes for all stakeholders, including the future growth of SK Square-SK Planet-11st and shareholders, investors, sellers, and customers."

SK Square-SK Planet-11st self-evaluate that this reorganization has enabled SK Planet and 11st, which need new growth momentum, to focus on increasing corporate value through mutual synergies.

They also established a stable management environment for 11st's future growth, thereby strengthening benefits for stakeholders including sellers, partners, and customers, and creating an opportunity to develop the commerce industry ecosystem through healthy competition. Additionally, 11st's financial investors ultimately recovered their 11st investment.

FIs invested KRW 500 billion in 11st in 2018. Among these, the National Pension Service's investment of KRW 350 billion was the largest. Both parties signed a call option contract under which SK Square would buy back FI shares if 11st's initial public offering (IPO) did not occur within five years. If the call option was forfeited, a drag-along clause was also included allowing FIs to sell shares to third parties, including SK Square shares.

However, the five-year IPO deadline of September 2023, a condition in the investment agreement, was not met, and SK Square forfeited the call option on 11st FI shares. This was because exercising the call option to buy back shares at the agreed return could raise breach of trust issues, given that 11st's corporate value had declined. FIs pursued management rights sale through drag-along but faced difficulties due to poor industry conditions.

Park seulgi (seulgi@fntimes.com)