South Korea’s leading internet portal operator Naver announced that it signed a 600 billion won ($531 million) share-swap agreement with major entertainment and logistics company CJ Group to enhance their competitiveness in the global e-commerce and entertainment industries.
Under the agreement, Naver would exchange 150 billion won ($132.8 million), each with CJ ENM Co. and Studio Dragon Co. Meanwhile, CJ Logistics would swap 300 billion won ($256.5 million) worth shares with the internet portal operator.
Worldwide Quality Content Production and Distribution
Through CJ’s well-established distribution network and infrastructure, Naver would expand its product delivery to vendors on its platform. In turn, CJ could release content through Naver’s platform and its Line messenger app.
The stock swap would give Naver a 5 percent stake in CJ ENM and 7.85 percent in CJ Logistics. Meanwhile, CJ ENM and CJ Logistics would own 0.32 percent and 0.64 percent in Naver, respectively.
In a statement, Naver said that it plans to introduce quality content worldwide through combining intellectual properties, platforms, and production capabilities. This is in light of the increasingly competitive e-commerce and entertainment industries.
Along with CJ, Naver pledged to invest 300 billion won ($265.5 million) to introduce globally competitive content over the next three years. The two companies would also create AR/VR-based content, develop a digital content platform, and foster content creators.
The investment would focus primarily on distributing K-content to global audiences amid the increasing popularity of “Hallyu” (Korean cultural wave).
Studio Dragon and CJ ENM would produce TV adaptations and movies based on Naver’s webnovels and webtoons.
“We want to provide new experiences and convenience to domestic and foreign users through collaboration with CJ Group, which has unique capabilities in content and logistics.”
-Naver CEO Han Seong-sook
Additionally, Naver and CJ also aim to strengthen TVING to compete with over-the-top global services such as Netflix. TVING is a subscription-based online streaming media platform, which recently spun-off from CJ ENM.
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