Lotte Corp., the holding company of Lotte Group, said on Feb. 27 it has merged with six of its unlisted affiliates in a move by the retail giant to enhance transparency.
The mergers of the investment divisions of the six affiliates with the holding company were approved at the annual shareholders meetings of the seven companies.
Among other goals, the move is meant to eliminate cross-shareholdings of Lotte subsidiaries by April as required under Korean law.
Hwang Kag-gyu, chief executive of Lotte Corp., said the elimination of cross-shareholdings will allow Lotte to be reborn again as a transparent company. The move could help enhance corporate value, he said.
A cross-shareholding system is a hallmark of Korea’s family-controlled conglomerates, known here as chaebol, enabling owner families to control their sprawling business interests.
In October, Lotte launched the holding firm in a bid to help Chairman Shin Dong-bin solidify his leadership and streamline the group’s managerial system.
By Song Seung-hyun and newswires (email@example.com