Lotte nixes China retail acquisitionLotte Group said it studied the acquisition of Chinese department-store operator Springland International Holdings although it is no longer considering an offer.
“We once looked at Springland, but we are not considering a bid right now,” Han Bo-young, spokeswoman at Lotte Group, said.
Lotte Group walked away from a potential deal in the first half of this year, said a person with knowledge of the matter who asked for anonymity because the deliberations were confidential.
An acquisition of Springland, with a market value of $1.4 billion, would have been Lotte Group’s biggest and its first since 2009, data compiled by Bloomberg show. Chinese President Xi Jinping is pursuing policies aimed at bolstering consumer spending.
Springland’s first-half profit rose about 14 percent from a year earlier. The company’s shares have advanced 16 percent in Hong Kong in the past 12 months, beating the benchmark Hang Seng Index’s 9.3 percent gain.
A Hong Kong-based investor relations official at Springland declined to comment on Lotte Group’s interest.
The company is valued at 12.1 times earnings, below the average ratio of 27.8 for Chinese department-store operators, according to data compiled by Bloomberg.
Beijing Wangfujing Dongan Group bought high-end department store owner PCD Stores Group for about $641 million earlier this year, data compiled by Bloomberg show. That deal valued PCD Stores at 25.6 times earnings, according to data.
Lotte Shopping, a unit of Lotte Group, operates five department stores in China and one each in Russia and Indonesia in addition to its 44 outlets in South Korea, the company said in May.