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By Kang Yoon-seung
SEOUL, Nov. 10 (Yonhap) -- South Korea's antitrust watchdog said Tuesday it has begun deliberations on Naver Financial Corp.'s proposed takeover of a local cryptocurrency exchange operator after its investigators concluded the deal could restrict competition in several markets.
The Fair Trade Commission's (FTC) announcement came after Naver Financial, the financial subsidiary of South Korea's top search portal operator Naver Corp., announced plans last year to acquire Dunamu Inc., which operates Upbit, through a share swap.
Under the proposed arrangement, each Dunamu share would be exchanged for about 2.54 Naver Financial shares, making Dunamu a wholly owned subsidiary of Naver Financial.
The FTC said its investigators identified a total of 12 horizontal, vertical and conglomerate combinations arising from the proposed deal.
Specifically, the deal would create six conglomerate combinations raising competition concerns in online payment services, search portals, online advertising, online shopping, financial data aggregation services and unlisted stock brokerage services.
The deal would also create two horizontal combinations in the domestic markets for listed stock investment platforms and online secondhand trading platforms, although both were presumed not to restrict competition, the FTC said.
Regarding the companies' planned entry into the won-denominated stablecoin issuance market, the FTC said the deal would create two vertical and two conglomerate combinations, also raising competition concerns.
Investigators recommended corrective measures to address the concerns, taking into account the companies' final remedy proposal, the watchdog said.
The FTC said it plans to hold a plenary meeting on the deal soon to reach a final decision.
In September, FTC Chairperson Ju Biung-ghi said during a press briefing that the agency would make efforts to have deliberations take place within the year.
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