Hansae buys control of online bookstore Yes24

Yes24 Co., the largest Internet bookstore in Korea, has been sold to Hansae Co., a garment manufacturer. Hansae bought 50.02 percent in Yes24 on Sunday, including the 12 percent stake held by the bookstore’s president, Lee Gang-in. Hansae also bought 2.2 billion won ($1.8 million) worth of convertible bonds, which could increase its stake in Yes24 to 53.8 percent when converted to stocks in December. It paid a total of 22 billion won for the deal. Founded in 1982, Hansae produces about 46 million pieces of knitwear a year, mostly for export. It generated about 30 million won in revenue last year. An official of Hansae said the firm bought Yes24 to enter the Internet sales field. Eyes are also set on what will become of Mr. Lee, an influential figure in technology start-ups firms, who is also the chairman of the Korea Internet Corporations Association. Most industry observers believe Mr. Lee will step down from the helm of the company. Hansae is showing movements to appoint a new president at Yes24. If Mr. Lee loses his executive position at the firm, he will automatically lose his position at the association as well. But some analysts view the deal between Yes24 and Hansae as Mr. Lee’s shoring up of his position by attracting a favorable buyer. They said Mr. Lee’s company control had been threatened by Will-bes & Co., a household goods firm which until the Hansae deal was Yes24’s largest shareholder. Mr. Lee was unable to be contacted yesterday, but sources said he had left for the United States to join his family. Mr. Lee founded Yes24 in June 1998. Employing aggressive marketing strategies such as direct transactions with publishers and cash payments, Mr. Lee expanded his firm into Korea’s leading of online bookstore with 99 billion won in annual revenue. In August last year, Yes24 merged with the second-largest online bookstore, Wowbook Co. But the company incurred large losses due to below-cost competition among Internet bookstores and Wowbook’s debts that the firm took on. Yes24 posted a 9.3 billion won net loss on 99.8 billion won in revenue last year. by Ha Ji-yun