The rights issue raised nearly $200 million! South Korean e-commerce giant Coupang received more development funds

According to Korean media reports, due to the relentless pressure from competitors and the negative news in the past period, the Korean e-commerce giant Coupang recently issued 228 billion won (198.5 million U.S. dollars) through rights issue to consolidate its foundation in South Korea. This is also the first rights issue of Coupang since its listing in March this year.

Coupang revealed last Tuesday that its board of directors decided on July 13 to sell 228.74 billion won worth of new shares to existing shareholders, its U.S. parent company. The company issued 4,574 new common shares at 50 million won per share . Coupang's U.S. parent company now owns 254,294 shares.

Coupang said it plans to use the proceeds for operations.

Even Coupang is feeling the pinch in South Korea’s increasingly competitive e-commerce environment . Coupang will use the new funding to bolster its e-commerce capabilities as major South Korean e-commerce platforms compete with Coupang’s biggest advantage, its ultra-fast delivery service.

In addition, Coupang is expected to add distribution centers and explore more overseas markets after conducting tests in Japan and Singapore.

After Coupang completed its initial public offering ( IPO) on the New York Stock Exchange in March this year with an extremely high valuation of US$ 63 billion and successfully completed a huge financing of US$4.6 billion , the subsequent development path of this Korean e-commerce giant was not smooth.

First, a fire at a Coupang warehouse in June killed a firefighter, sparking criticism from politicians and media that Coupang had lax safety standards and poor working conditions at its warehouses.

The second is the sales of Japanese Rising Sun Flag related products and the death of Coupang Eats store owner . In addition to these, Coupang has also been subject to strong public protests due to labor issues. In the past year, at least nine Coupang workers have died due to "inhumane working conditions." Because of these negative news, Coupang has been boycotted by Korean consumers for many times and is facing a consumer boycott crisis.

Last year, Coupang posted an operating loss of 550.4 billion won on sales of 13.9 trillion won. Sales increased 95% year-on-year, but the company is still not profitable.

South Korea

E-commerce

Coupang