This article was displayed on the ChosunBiz MoneyMove (MM) website at 3:55 p.m. on Apr. 29, 2026.
The open competitive bidding to sell management control of the domestic online video service (OTT) corporations Watcha failed. The sale has effectively returned to square one. The sale manager plans to resume the search for a new owner through a rebid.
According to the investment banking (IB) industry on the 29th, the main bid for the Watcha sale that ended on the 22nd was ultimately declared a failure. Neither CJ ENM nor Kinolights, both considered strong contenders, took part.
In rehabilitation M&A, a bid fails when there are no bidders participating in the main bid, or even if there are participants, when they do not meet the requirements in the bid memorandum and it is hard to view their offers as valid acquisition proposals. A bid can also fail when the practical benefits of an open competitive bidding are judged to be lacking in terms of price verification or creditor interests.
With the main bid ultimately failing, Samjong KPMG, the sale manager, is said to be set to market to potential acquirers and proceed with a rebid. There is also a possibility of switching to a limited competitive bid that narrows the pool to qualified candidates, or to a stalking-horse method.
Watcha is a personalized movie recommendation service company founded in 2011. It started as a service that recommends content based on user rating data, and in 2016 it launched the monthly subscription VOD streaming service "Watcha Play," entering the OTT market. It later secured many users by leveraging its movie rating service and recommendation algorithm, but growth slowed as competition intensified with major OTTs such as Netflix, Tving, Wavve, and Coupang Play.
Analysts say the burden of content acquisition expense and limited funding capacity also held Watcha back. Unlike major platforms, Watcha did not have much capacity for its own content investment, and as competition in the domestic OTT market unfolded around expanding content investment rather than raising subscription fees, it struggled to improve profitability. Watcha pursued normalization through fundraising and a sale but failed to reach a clear conclusion, and in Aug. last year it ultimately received a decision to commence rehabilitation proceedings from the Seoul Bankruptcy Court.
This sale has been seen as a key step in drawing up Watcha's rehabilitation plan. If a new acquirer comes in, it could prepare a rehabilitation plan through new capital injection, debt adjustment, and business restructuring, but if the sale is delayed, uncertainty in the rehabilitation process will inevitably grow.
As the sale manager has decided to move to a rebid, the key will be whether it can secure a bidder with strong acquisition intent by lowering price expectations or adjusting the transaction structure.