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Lotte vows to punish 'disinformation' after crisis reports tank stock

Published: 02 Dec. 2024, 16:24

KIM JU-YEON
[email protected]

A military helicopter flies near Lotte World Tower in Songpa District, southern Seoul on Sept. 24, as part of a rehearsal for Armed Forces Day. [NEWS1]

Lotte Corporation asked police to identify and punish "those spreading disinformation” after reports of a liquidity crisis sent its stock plummeting.

Yonhap reported Monday that Lotte had filed a complaint to the Seoul Gangnam Police Precinct requesting that it investigate the individuals behind November reports that the corporation planned to file for a moratorium on its repayments, on charges of injuring the firm's credit.

“The charge is not against a specific person. Lotte asked that police look into those spreading disinformation including one that the group will file for a moratorium,” a source with knowledge of the matter told the Korea JoongAng Daily. A Lotte Corporation spokesperson, reached for comment, declined to confirm Yonhap's report.

A YouTuber alleged, among other things, in a video uploaded on Nov. 16 that Lotte would file for a moratorium and cut its work force by more than 50 percent and that Lotte Engineering & Construction’s faltering business had affected joint guarantees among affiliates. The video, which reached almost 500,000 views, has been made private as of Monday.

Lotte Corporation was trading at a 52-week low of 20,050 won ($14.3) at one point on Nov. 16, the day of the video's release, down 8.86 percent from the previous trading session.

Lotte Corporation has publicly denied the allegations since. The firm first said, in a filing to the Financial Supervisory Service, that “rumors regarding Lotte Group’s liquidity are untrue” on Nov. 18.

Korean newspaper Money Today calculated that the stock value of holdings company Lotte Corporation and major affiliates, including Lotte Chemical and Lotte Shopping, had shed 600 billion won in one trading session the same day.

Lotte added in a statement released Nov. 21 that it had 139 trillion won in total assets as of October and announced plans to improve its finances. It did confirm on Nov. 22, however, that Lotte Chemical had been unable to comply with the terms of bonds issued between September 2013 and March 2023 and has scheduled a meeting with bondholders to discuss adjusting those terms.

BY KIM JU-YEON [[email protected]]