As the payment settlement delay for sellers of TMON and WeMakePrice continues to escalate, parent company Qoo10 has announced plans to raise $50 million (approximately 70 billion won) through its overseas affiliates next month. However, South Korean financial authorities believe this amount will be insufficient to resolve the crisis, with unsettled payments estimated to be in the hundreds of billions of won.
According to the financial industry on July 28, Qoo10 proposed a plan to Korean financial authorities to raise $50 million through its North American e-commerce affiliate, Wish. Qoo10 had acquired Wish in February for 230 billion won. Despite this effort, the funds are expected to fall short. As of July 22, financial authorities identified unsettled amounts of 109.7 billion won (750 sellers) for TMON and 56.5 billion won (195 sellers) for WeMakePrice. These figures only account for transactions from May. When considering the funds needed for transactions in June and July, along with customer refunds due in August and September, the total required is expected to reach several hundred billion won.
A financial authority representative stated, “Qoo10 has not presented a concrete funding plan, and even if they raise 70 billion won, it won’t be enough to resolve the issue.”
Additionally, on the previous day, Kwon Do-wan, head of TMON’s Operations Division, addressed consumers gathered at TMON’s headquarters in Gangnam-gu, Seoul, seeking refunds. He stated, “Qoo10 has around 60 billion won in funds in China, but we are unable to withdraw it immediately, so we are attempting to secure a loan.” However, when questioned by the press, he admitted, “I have heard about it, but I am not certain.” It appears Qoo10 is attempting to raise several hundred billion won through various channels.
Another financial authority official expressed skepticism, saying, “We cannot trust Qoo10′s statements at all. For trust to be established, Qoo10′s CEO Ku Young-bae should have appeared by now, but he has not.” There have been suggestions that Ku should use his personal assets to resolve the situation, but his current whereabouts are unknown. On July 27, in response to an inquiry from The Chosunilbo requesting a statement, Ku replied via text message, “I am working hard to secure funds and find solutions. I ask for your understanding in refraining from interviews for the time being.”
