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Lotte to sell rental car subsidiary to Affinity Equity for $1.13B

Published: 06 Dec. 2024, 19:07 Updated: 06 Dec. 2024, 19:23

CHO YONG-JUN
[email protected]

Lotte Rental in Jeju Island [LOTTE RENTAL]

Lotte agreed to sell its subsidiary Lotte Rental to buyout firm Affinity Equity Partners for 1.6 trillion won ($1.13 billion), the retail group announced Friday.

Under the legally binding memorandum of understanding, Lotte will sell a 56.2 percent stake in Lotte Rental, which was owned by Hotel Lotte and Lotte Hotel Busan.

Lotte’s decision comes as the conglomerate is improving its cash flow after suffering a liquidity crunch due to its chemical affiliate.

The two parties have agreed to prioritize a stable transition for Lotte Rental employees.

Affinity Equity Partners will operate Lotte Rental as a separate business entity from SK Rent-a-Car for three years and maintain the Lotte branding for the period. Affinity acquired SK Rent-a-Car for 820 million won in August 2024.

Lotte Rental, previously owned by Kumho and KT, was acquired by Lotte in 2015. The company operates Lotte Rent-a-Car, Lotte Auto Care and car-sharing service G Car, previously known as Green Car. The company is also the largest shareholder of another car-sharing service, Socar.

BY CHO YONG-JUN [[email protected]]