(Yicai Global) March 27 -- Lotte Mart in China has seen its operations hamstrung, but the Lotte Group Co. [KS:LOTZ] has decided to pump USD300 million (KRW360 billion) into its Chinese division nonetheless.
Shin Dong-bin, Lotte Group’s president, told theWall Street Journalon March 24, “I love China and I want to continue my business in China.”
The imbroglio and ensuing boycott over the South Korean government’s requisition of land Lotte owned for deployment of the US THAAD missile has devastatingly impacted Lotte Mart's China business, but Lotte has nevertheless decided to invest KRW360 billion here, South Korean newspaperJoongang Ilboreported March 25. Lotte Group subsidiary Lotte Shopping Co. [KS:023530] said March 24 it will invest another USD192 million in Lotte Shopping Holdings Hong Kong Co., for which it will borrow USD108 million.
“Due to business closures, there are no sales in China, but we need capital to buy goods and pay wages, so we decided to invest,” A Lotte Mart insider explained. Lotte took the initiative to close about 20 stores in China, the Korean Broadcasting System reported on March 20. Before that, 67 of its Lotte outlets in China had been ordered to suspend business out of ‘fire safety’ considerations. That means more than 90 percent of Lotte’s business in China has seized up.