Quten is establishing a new corporation to promote the integration of Timon and WeMakePrice. It is also promoting a structural transformation by forming a seller shareholder association and allowing them to participate in management. However, it is expected that there will be difficulties in promoting new commerce due to the need for court approval and the lack of practicality in forming a seller shareholder association.
Quten announced on the 9th that it will apply to the court to establish a new corporation called KCCW (K-Commerce Center for World) as a platform for the merger of Timon and WeMakePrice on the 8th and will invest 999,999,900 won in capital. The plan is to first establish a new corporation to merge the two companies before the merger, which requires court approval.
Quten plans to merge Timon and WeMakePrice through KCCW in the future and normalize its business. Quten will reduce its stake in Timon and WeMakePrice by 100% with the consent of stakeholders, and Quten CEO Koo Young-bae will place his entire 38% stake in Quten in a blind trust to the merged company. In this case, KCCW will change its structure to control the entire Quten Group.
A method in which sellers participate in management in the form of a shareholders’ association was also proposed. This is a method in which the sellers’ shareholders’ association can directly participate in the board of directors and management. A Quten official said, “When forming a new platform, we will establish a system to settle within 7 days of delivery completion.”
Previously, Timon and WeMakePrice were known to be focusing on sales rather than mergers. According to the industry, WeMakePrice has been negotiating a sale with other commerce companies. Timon also announced its intention to sell instead of mergers on the 2nd, with CEO Ryu Gwang-jin saying through the media, “A merger is nonsense.”
However, considering the shareholding structure of Quten Group, there is a high possibility that the merger attempt itself will proceed as Quten intends. According to the Financial Supervisory Service and others, Quten owns 100% of Timon, 43.2% of WeMakePrice, and 100% of Quten Korea, which owns 29% of WeMakePrice.
However, the merger is unlikely to proceed immediately as the court approval procedure under the Debtor Rehabilitation and Bankruptcy Act (Bankruptcy Act) remains pending. While a typical merger between companies does not require court approval, Timon and WeMakePrice must receive court approval. In some cases, creditor approval procedures may be required during the court approval process, so it is expected that there will be difficulties until the actual merger of Timon and WePrice is completed.
Meanwhile, Quten and KCCW began accepting letters of intent to convert unsettled amounts into convertible bonds (CB) from Timon and WeMakePrice sellers on the 9th. They plan to decide on the first shareholder group with the sellers recruited by the end of August and then request the court to approve the merger. If the merger is approved, they plan to pursue the establishment of the second and third shareholder groups. In an appeal to sellers, CEO Koo said, “If the merger is successful, traffic and business scale will rise to 4th place in Korea.”
However, since sellers’ complaints are still ongoing, there is a question mark over the actual formation of a shareholders’ association. One seller who requested anonymity criticized, “I will not use a platform that has already lost trust,” and “It is like giving shares of an unstable company with the money as collateral.” Seo Ji-yong, a professor of business administration at Sangmyung University, said, “What sellers ultimately want is the sales price,” and “We should focus on returning the actual damages.”