Lotte Group sells China theme park project to local Chinese company

This undated file photo shows the suspended construction site of the Lotte World theme park in Shenyang, China, under the halted Lotte Town project. [YONHAP]

Korean retail giant Lotte Group has signed a deal to sell its China theme park project to a local company in the Chinese northeastern city of Shenyang, a group official said Thursday.

The group official told Yonhap News Agency that Lotte has signed to sell its entire stake in its China-based company Lotte Glory Properties Shenyang, running the project, to a Shenyang city-run company.

The official did not provide the value of the contract, but reports say the deal fetches up to 450 billion won ($327 million).

The "Lotte Town" project that includes a theme park, a residential area, a department store and a movie theater has been halted since 2017 due to diplomatic tensions between Seoul and Beijing.

Korean retailers and other businesses have been hit hard by the lingering impact of a diplomatic dispute over the deployment in Korea of a U.S. anti-missile system called Thaad in 2017.

The company has recently signed a stock purchase agreement with a Shenyang city-run company to sell its China-based company running the project, though the sale process has yet to be finalized, a Lotte spokesperson said over the phone.

Lotte kicked off the complex town project in 2008 with an aim to complete it in 2019, but it was suspended in December 2016 due to China's so-called retaliations against the Thaad installation.

Lotte sold most of its Lotte Mart outlets in 2018 and withdrew its food manufacturing business from China in the following year.

In April 2020, the retail conglomerate closed the Lotte Department store in Shenyang, which had opened in May 2014 amid the Covid-19 pandemic.

Lotte said it is also in the process of selling the Lotte Department store in Chengdu, the capital city of Sichuan Province, due to sluggish sales.

Yonhap