(Yicai Global) Oct. 15 -- Lotte Mart will close all of its 12 remaining branches in China before the end of the year after failing to find a suitable buyer. Other outlets sold earlier to local firms will not retain the South Korean hypermarket chain's branding, signaling the company's official exit from the market.

"The company has decided for the moment to completely withdraw from China by the end of the year," a member of the company's public relations staff surnamed Cui told Yicai Global in response to a claim from an industry insider about the withdrawal.

The 12 remaining branches are mainly located in central China with a few scattered in southwestern cities like Chengdu and Chongqing as well as in northeast provinces like Liaoning and Jilin. Chinese retail firms Wumei Holdings and Liqun Group had already completed deals to take over 93 outlets earlier in the year.

Lotte had been struggling in China this year since it agreed to hand over a golf course to allow the US military to build an anti-missile system in South Korea. Local governments began closing down Lotte stores for breaching fire safety regulations shortly after the land transfer, which was shunned by Beijing. The campaign cost the firm CNY7.1 billion (USD1.1 billion) and it has been unable to recover.

Lotte has met multiple difficulties in its efforts to sell out its Chinese locations. The company's package sale valuation was 40 percent more than potential buyers were willing to pay, leading to the decision to split up the package. The firm has not found suitable candidates to purchase its central Chinese branches so will shut them down, an insider told Yicai Global. 

"Lotte Mart had tried to sell its Central Chinese stores in a bundle with other assets but because the potential acquirers were mainly regional enterprises, they did not reach an agreement on prices," the insider said. "They are yet to be sold and Lotte has decided to liquidate them as soon as possible as they continue to lose money and there aren't many outlets in the region."

Lotte pumped some KRW360 billion (USD317.8 million) into Chinese operations in March last year, followed by another KRW340 billion in August 2017 to maintain operations, though it was still unable to revive these branches. The Korean firm ran up losses of KRW268 billion (USD236.6 million) last year, according to its financial reports. The chain has lost about KRW1 trillion (USD882.5 million) in China since the second half of 2016.