FTC launches review of Naver Financial-Dunamu deal

Résumé détaillé

The Korea Fair Trade Commission (FTC) has begun deliberations on the proposed merger between Naver Financial Corp., South Korea’s largest online payment provider, and Dunamu Inc.,…

The Korea Fair Trade Commission (FTC) has begun deliberations on the proposed merger between Naver Financial Corp., South Korea’s largest online payment provider, and Dunamu Inc., operator of Upbit, the country’s largest cryptocurrency exchange.

The FTC said Tuesday it had submitted its merger review report to the commission and sent it to the companies Friday. The report outlines potential legal violations identified by FTC examiners and their proposed corrective measures. Its submission marks the start of formal deliberations on the deal.

Under the proposed transaction, Naver Financial would acquire all of Dunamu’s shares, making it a wholly owned subsidiary, in exchange for around 2.54 Naver Financial shares for each Dunamu share.

The FTC received the merger filing in November last year, a year before submitting its review report.

FTC examiners identified 10 markets in which the merger could affect competition, including online payments, digital asset exchanges, search portals, online advertising, online shopping and unlisted stock brokerage services.

The review also covers the potential impact on a domestic market for Korean won-denominated stablecoins, which has yet to be established.

The FTC said it considered the possibility that the merger could affect future competition in the market, citing a maturing regulatory environment, with more than 10 digital asset-related bills introduced in the National Assembly.

FTC examiners identified 12 horizontal, vertical and conglomerate combinations that could affect competition in the relevant markets.

Horizontal combinations involve competing companies, while vertical mergers involve businesses at different stages of production or distribution. However, the examiners found no competition concerns in two horizontal mergers, including those involving stock investment platforms.

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