Lotte aims to sell China stores by year-end

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South Korea’s Lotte Group aims to sell its Lotte Mart stores in China by the end of this year, a company executive said on Thursday, the firm suffering in the nation after its decision to hand over its land to house the THAAD missile defense system.

The country’s No.5 conglomerate decided to bow out of the business after most of its hypermarkets and supermarkets in China were shut down amid political tensions between the two countries.

The group adds that several firms have expressed interest in the troubled unit.

“We are in detailed talks with some of those companies,” Lim Byung-yun, an executive vice president at Lotte Corp, the group’s newly launched holding company, said at a news conference.

The size of the deal is expected to be small at a couple hundred million dollars, a banking source said, declining to be identified as the talks were confidential.

Lotte gave up its golf course to the Korean government in Februrary, a plan that has angered Beijing as the radar can penetrate far into its territory.

The move has also taken a toll on trade and tourism. South Korea's presence in the Chinese import market is shrinking and is likely to fall below 10 percent this year, despite its strong exports to China led by semiconductors and petrochemicals, the Yonhap News Agency reported on Tuesday.

Lotte Corp executive Lee Bong-chul said it would take time more to list the group’s Hotel Lotte unit, as political tensions with China have resulted in declines in the number of Chinese tourists visiting South Korea, hurting sales of both its hotel and its duty free businesses.

The offering, expected to be worth around $4.5 billion, was delayed following a corruption scandal involving Lotte Group Chairman Shin Dong-bin. He is on trial after prosecutors indicted him and other executives on embezzlement and other charges. Shin has denied the charges.

Source(s): Reuters