Lotte Respects FTC Review on Rental Car Merger, Will Consider Additional Proposals

Fair Trade Commission Blocks Lotte Rental and SK Rent-a-Car Merger
"Concerns Over Market Competition"
Lotte: "Continued Improvement of Group-wide Financial Structure"
"53 Trillion Won in Real Estate Assets, 13 Trillion Won in Cash Holdings"

Lotte Group stated on January 26 that it "respects the intent of the review results" after the Fair Trade Commission prohibited the business combination related to Affinity Equity Partners' acquisition of shares in Lotte Rental. Affinity Equity Partners is a private equity fund (PEF) management company.

Lotte explained in a press release distributed on the same day, "We will review various options, including the possibility of making additional proposals through discussions with Affinity Equity Partners to address the Fair Trade Commission's concerns about the strengthening of market dominance."

Previously, in August 2024, Affinity acquired SK Rent-a-Car and, in March of the previous year, signed a contract to acquire a 63.5% stake in Lotte Rental, reporting the business combination to the Fair Trade Commission. The Fair Trade Commission viewed this as a significant concern for limiting market competition, as both Lotte Rental and SK Rent-a-Car-the top two rental car companies in Korea-would come under Affinity's control. The Commission noted that the market could become polarized, with one overwhelmingly large conglomerate and numerous small and medium-sized enterprises.

Lotte Group emphasized that, although the sale of Lotte Rental shares has been delayed, it is proactively focusing on strengthening financial stability by pushing forward with intensive restructuring and business portfolio reorganization across the group, regardless of the delay.

Specifically, Lotte Chemical has been continuously implementing company-wide restructuring since 2024 and has completed the sale of its Pakistan subsidiary and its stake in Resonac. The company also highlighted that it is currently working to improve the efficiency of its naphtha cracking center (NCC) operations, particularly in major petrochemical complexes such as Daesan and Yeosu, in line with government policy directions. Lotte plans to further improve its financial structure and capital efficiency by making additional adjustments to its business portfolio in the future.

According to Lotte, the group owns real estate assets worth a total of 53 trillion won, including high-quality assets that can be liquidated, and has secured approximately 13 trillion won in cash-equivalent assets. The company stressed, "We have sufficient financial stability to respond to both short-term and mid- to long-term liquidity needs," and added, "We are actively seeking external investment to raise the funds necessary for business portfolio adjustments."

This content was produced with the assistance of AI translation services.