Lotte sells 61.2% stake in Lotte Rental to TPG

Group continues to reshape business portfolio

A Lotte Rent-A-Car outlet at Jeju Auto House. [Lotte Rental]
A Lotte Rent-A-Car outlet at Jeju Auto House. [Lotte Rental]

Lotte said Friday it had completed the sale of its entire controlling stake in Lotte Rental to global alternative asset manager TPG for 1.31 trillion won ($981 million).

Lotte signed a share purchase agreement in August to sell the full 61.2 percent controlling stake held by Hotel Lotte and Busan Lotte Hotel to TPG. The total transaction value came to approximately 1.31 trillion won, or 59,000 won per share.

Lotte said it plans to use the proceeds to strengthen the financial health of Hotel Lotte and Busan Lotte Hotel, sharpen their core competitiveness and secure new growth engines.

Lotte Rental intends to leverage TPG's global investment capabilities and network to build a stronger growth foundation and improve the competitiveness and long-term growth potential of its existing businesses.

Lotte has been restructuring its group portfolio since last year, focusing on non-core businesses and underperforming assets.

Lotte Chemical is working to restructure its basic chemicals operations in Yeosu and Daesan as it shifts its portfolio toward high-value specialty products. The company is also streamlining non-core businesses, including its Pakistan subsidiary, Titan Malaysia and its building materials unit.

Lotte Energy Materials is upgrading its business structure around high-value segments such as battery foil for ESS and circuit foil for semiconductors, while also reshaping its portfolio through moves including the sale of Lotte Ecowall.

Lotte Shopping and Hotel Lotte are pursuing earnings improvements alongside efforts to dispose of idle sites and underperforming stores, as well as the sale of L7 Gangnam.

"We selected the acquirer after comprehensively considering Lotte Rental's core competitiveness and long-term growth potential, and we look forward to continuing that growth together with the new shareholder," a Lotte official said. "Lotte will also accelerate its portfolio adjustments while closely reviewing the profitability, growth potential and strategic fit of each business to strengthen financial soundness and build a solid foundation for sustainable growth."


spa@heraldcorp.com