Lotte completes 1.3 trillion won sale of Lotte Rental, accelerates business portfolio restructuring

[Financial News] Lotte Group is accelerating its group-wide business portfolio restructuring as it wraps up the sale of its controlling stake in Lotte Rental.
According to industry sources on the 30th, Lotte completed the process of selling its controlling stake in Lotte Rental to TPG, a global alternative asset manager.
Earlier, on August 11, Lotte signed a share purchase agreement to transfer to TPG the entire 61.2% stake in Lotte Rental held by Hotel Lotte Co., Ltd. and Lotte Hotel Busan, along with management control. The total sale price was approximately 1.3105 trillion won, or 59,000 won per share.
Lotte plans to use the proceeds from the sale to improve the financial soundness of Hotel Lotte Co., Ltd. and Lotte Hotel Busan, strengthen the competitiveness of their existing businesses, and secure future growth engines. Lotte Rental plans to boost its business competitiveness and strengthen the foundations for medium- to long-term growth by leveraging the global investment capabilities and network of its new controlling shareholder, TPG.
The sale is part of Lotte’s group-wide business portfolio restructuring, which it has pursued since last year through measures including exiting non-core businesses and improving the efficiency of underperforming assets.
Lotte Chemical Corporation is pursuing a restructuring of its basic chemicals businesses in Yeosu and Daesan to improve its business mix, focusing on high-value-added specialty businesses. It is also working to streamline non-core businesses, including its Pakistan subsidiary, Titan Malaysia subsidiary, and building materials business.
LOTTE Energy Materials is also restructuring its business around high-value-added products such as battery copper foil for energy storage systems (ESS) and circuit foil for semiconductors. It has also been working to divest non-core assets, including through the sale of Lotte Eco Wall. Lotte Shopping and Hotel Lotte Co., Ltd. are also disposing of unused properties and underperforming stores, and focusing on improving asset efficiency through measures such as the sale of L7 Gangnam.
A Lotte official said, “We chose the buyer after comprehensively considering Lotte Rental’s fundamental competitiveness and medium- to long-term growth potential, and we hope to continue growing sustainably with the new shareholder.” The official added, “Lotte will also accelerate adjustments to its group portfolio while closely reviewing the profitability, growth potential, and strategic fit of each business, improving its financial soundness and firmly establishing a foundation for sustainable growth.”

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