This article was published on Feb. 21, 2025, at 4:46 p.m. on the ChosunBiz MoneyMove site.
As the comprehensive delivery platform Manna Corporation faces bankruptcy due to management difficulties, domestic venture capital (VC) firms and strategic investors (SI) that injected hundreds of millions of won have initiated moves for an exit. However, with Manna Corporation fully capitalized, the likelihood of recovering funds is projected to be close to zero.
According to investment banking (IB) industry sources on the 21st, payment service provider Danal exercised its stock purchase request (put option) against Manna Corporation. Under the shareholder agreement, Manna Corporation must acquire 178,735 common shares and 34,448 preferred shares held by Danal for about 57.7 billion won. This amount considers the investment of 25 billion won and an internal rate of return (IRR) of 15%. However, Danal has already judged the likelihood of recovery to be nonexistent and has written down a significant amount. As of the third quarter of last year, Manna Corporation’s book value was at about 14 billion won.
Another investor company related to Manna Corporation noted, “We believe there is no possibility of recovering funds except for Manna Corporation securing additional investments and repaying,” and added, “We reflected the impairment loss, which reduces equity value on the financial statements, and are considering whether to exercise the put option while observing the movements of lead investors.”
Founded in 2014, Manna Corporation is a platform company that integrates seven delivery agency services. Through its subsidiary Manna Planet, it provides order management and settlement services and has expanded its business areas to include point of sale (POS) and payment services. The company collects delivery service fees in advance from franchisees in the form of credit, which are then deducted from the credit when delivery services are utilized and paid to the riders.
Manna Corporation experienced rapid growth during the COVID-19 pandemic as demand for delivery services exploded. Revenue increased from 139 billion won in 2020 to 271.9 billion won in 2021. During the Series A round in 2019, it received investments from Striker PE, Korea Investment & Securities, and IBK Corporations. In the Series B round of 2021, Korea Investment Partners, Bailey PE, and IBK Securities participated as investors. At that time, Danal also became the second-largest shareholder by purchasing existing shares worth 35 billion won from a financial investor. The total investment amount in Manna Corporation is reported to have far exceeded 100 billion won.
However, the rise in labor costs, intensified competition, and increased goodwill amortization costs due to mergers among delivery platforms led to a net loss. The scale of net losses grew from 2.2 billion won in 2020 and 6.6 billion won in 2021 to 22.4 billion won in 2022. As of late 2023, when the audit report was released, the deficit stood at 55 billion won, reflecting that the company has now fallen into complete capital erosion.
Some investors reportedly recognized the deterioration of Manna Corporation’s business belatedly and began to respond. Investment firms that have already reflected impairment losses are reviewing whether to exercise put options. Major shareholder Danal, which holds the largest equity, and lead investor Korea Investment Corporation have already been in negotiations with Manna Corporation. However, Danal, believing that recovering funds through negotiations would be difficult, first exercised the put option and initiated the fund recovery process.
Danal stated, “According to the shareholder agreement, the deadline for Manna Corporation to make the payment for the put option is by the 27th, and no agreement on the contract payment has been reached,” and added, “If Manna Corporation is unable to pay, we will proceed according to the contract.”