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This article was published on January 20, 2021 at 13:35 The Bell Paid PageIt is an article expressed in

As Naver succeeded in acquiring the management rights of the Canadian content platform Wattpad, it opened up a large-scale M&A deal. This deal is the largest buyout deal in Naver’s history. Naver has been active in discovering and investing in promising companies, but this has mainly been limited to small deals. With this deal, which showed drastic investment according to the company’s long-term growth strategy, interest is gathering whether it will go on to a large M&A in the future.

According to industry sources on the 20th, Naver held a board meeting the day before and decided to acquire Watpad, a web fiction platform. It is expected to be finalized in the first half of the year after the approval of related agencies in Korea, the United States, and Canada. The transaction volume is about $600 million. With this, Naver set a record for the largest buyout deal among all M&As.

Naver has been a strategic investor (SI) who has been quite active in the M&A market. In particular, last year, it received industry attention by concluding a number of deals.

At the end of November, Naver, along with other financial investors (FIs), invested 70 million dollars in Bucket Place to acquire an 11.33% stake. Bucket Place is the operator of the interior platform’Today’s House’. In the same month, it invested 35 billion won in Insung Data, the operator of’As You Think’, a food delivery service company.

In August, it announced a plan to invest 100 billion won in SM Entertainment, and invested 12 billion won and 41.5 billion won in Mystic Story and SMEJ Plus, respectively.

Excluding the stake swap deal with CJ Group affiliates, which amounted to 600 billion won, the scale of deals that Naver promoted was mainly concentrated on small scale. It is evaluated that it has shown strength in small M&A by acquiring venture companies or actively investing in minority shares.

According to Naver, by the end of September last year, the number of investments (based on the initial acquisition date and amount) to other corporations at home and abroad was 37, with the acquisition amount exceeding 700 billion won. Considering that CJ deals and SM Entertainment investments were made in the fourth quarter, investments exceeding KRW 1 trillion were made last year alone. Compared to the previous year, the total investment volume continues to grow, but considering the number of cases, the general deal size was only small and medium.

However, from the beginning of this year, when a large-scale global M&A was carried out as a surprise, it is evaluated that the big deal was opened with this deal.

Considering the size of $600 million, Naver has made a significant strategic decision for the future growth blueprint of global IP expansion. Naver has continued to expand into North America, including the United States and Canada, and acquired the world’s No. 1 web novel platform, gaining solid brand recognition in the region.

It is another harvest that has certainly planted the image of a company that can make hot investments if the strategic direction for growth is firm. With this opportunity, there is also an expectation that Naver will increase its influence in the M&A market in the future.

This deal was Naver’s first large-scale global deal, but it attracts more attention as it does not appoint a separate advisor. Usually, when a domestic company acquires an overseas property, it is often helped by Global IB, which has a good local situation. However, in the acquisition of WhatPad, Naver managed the entire deal without appointing an IB.

This draws attention in line with the recent efforts to recruit M&A personnel. Last year, Naver has been making efforts to secure talent, centering on manpower with abundant M&A experience. In fact, from the second half of last year, when strategic alliances with SM Entertainment and stake swaps with CJ Group were successively established, there were talks in the industry that Naver’s expansion of investment, which had recruited manpower, was in earnest.

An official in the IB industry said, “Previously, we mainly focused on discovering promising companies and small-scale investments, but after actively recruiting human resources last year, there was a lot of expectation that we would aggressively pursue large-scale investments.” It was an opportunity to clearly imprint the color change of investment in the industry.”