이 기사는 2021년 06월 14일 07시38분 thebell에 표출된 기사입니다

US ecommerce giant eBay may consider accepting a cash and stock payment, rather than all cash, in a sale of its South Korean operations, which are expected to fetch more than 3 trillion won ($2.7 billion).

The race to acquire eBay Korea, which operates popular open market platforms Auction and Gmarket, has turned into a two-way battle between Lotte and Shinsegae, after both South Korean retail conglomerates submitted binding offers in the second round of bidding last week.

Their bids reportedly were in the 3 trillion won range, while the US company initially sought a valuation of 5 trillion won. Many expect the seller to conduct another round of bidding, hoping competition between the bidders drives up the sale price.

Both Lotte and Shinsegae, which are among the country’s largest conglomerates, have sufficient financial capability to fund the acquisition. But they are likely to be cautious about raising bids, especially considering the deal structure in which the money will be paid entirely to eBay with no capital going toward the target company.

Some raise a possibility of eBay proposing a cash and stock deal, in which the seller receives a proportion of the payment in cash and the rest in shares of the buyer, to encourage the bidders to raise their offers. This deal structure is said to have also been considered by some of the suitors before the second round of bidding.

Kakao Corp’s 2016 acquisition of Loen Entertainment is one of the successful examples of cash and stock deals. Kakao bought the firm’s 76.4% stake owned by Affinity Equity Partners and SK Planet. In a deal worth 1.87 trillion won, 1.12 trillion won was paid in cash and the remaining 754 billion won was paid in Kakao shares.

The transaction valued Kakao, which was then privately held, at around 6.7 trillion won. This represented 41 times earnings before interest, taxes, depreciation and amortization (EBITDA) – which was much higher than Loen Entertainment’s enterprise value of 30 times EBITDA – indicating the seller’s belief in synergy to be created by the combination of the two companies.

Kakao has shown rapid growth since its initial public offering in 2017, which enabled Affinity Equity Partners and SK Planet to generate high returns from their divestment in Kakao. (Reporting by Hee-yeon Han)