Naver Agrees To Acquire Upbit Parent In $10.3B Deal

Internet giant Naver Corp. has agreed to acquire Dunamu Inc, the operator of South Korea’s largest crypto exchange Upbit, in an all-stock deal valued at about $10.3 billion.

Under the deal that was unveiled in a regulatory filing today, Naver’s fintech arm Naver Financial will issue 2.54 new shares for every 1 share in Dunamu, a ratio that suggests the combined entity would be a $13.56 billion fintech powerhouse that combines payments, digital assets, and AI-driven financial services.

“The integration of Dunamu will enable us to create powerful synergies across AI, search, digital payments and blockchain technology,” a Naver official told The Korea Herald. “As global tech shifts toward a Web3 paradigm, this merger positions us at the forefront of innovation and international expansion.”

Naver shares surged as much as 7% on news of the deal but have since pared gains to trade up 4% for the day.

Naver share price (Source: Google Finance)

Dunamu’s Chair Will Hold The Largest Stake In Naver Financial

A shareholder vote for the share exchange agreement is slated for May 22 and the transaction is expected to close by June 30 if approved. 

The deal must receive consent from Dunamu stakeholders including Chairman Song Chi-hyung (25.53%), Vice Chair Kim Hyoung-nyon (13.11%), Kakao Investment (10.59%), Woori Technology Investment (7.2%) and Hanwha Investment & Securities (5.94 %).

The deal also faces multiple regulatory reviews. The Fair Trade Commission and financial regulators will likely scrutinize the share exchange and subsequent merger for market concentration, consumer impact, and systemic risks. This process could take a year, or even longer. 

Regulators are also expected to consider whether the deal warrants easing Korea’s longstanding “financial-virtual asset separation” guideline, which restricts cooperation between traditional finance firms and companies operating in the crypto space. 

“We will broadly review whether easing this regulation aligns with global trends,” said Kim Sung-jin, head of the Financial Supervisory Service’s virtual asset division.

If Dunamu shareholders and regulators give the go ahead, Naver’s stake in Naver Financial would drop from 70% currently to 17% after the share exchange.

Song will hold the largest stake in Naver Financial after the exchange but both he and the Vice Chair Kim have agreed to delegate their voting rights. This allows Naver to secure 46.5% of the voting rights and gives the company a controlling position for its financial arm. 

Upbit Holds An 80% Share Of South Korea’s Crypto Market

South Korea is one of the global crypto market’s most active retail trading hubs, and Upbit boasts an over 80% share of the country’s market.  

Top crypto spot exchanges (Source: CoinMarketCap)

Upbit is also ranked among the top five largest crypto exchanges globally in terms of trading volume, alongside Binance, Coinbase, Bybit, and OKX. 

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