[THE INVESTOR] Lotte
Group on Oct. 25 pledged to invest a fresh 40 trillion won (US$35.16 billion) in the next five years and seek a stock listing of Hotel Lotte that has been stalled due to prosecutors’ investigation into the retail giant’s corruption scandal.
The new plans came as Chairman Shin Dong-bin
issued a public apology for the group’s series of irregularities. The Lotte chief himself was also indicted on charges of tax evasion, embezzlement and other criminal charges.
“Lotte plans to invest 40 trillion won over five-year period and hire 70,000 new employees,” Shin said at a press conference held at Lotte Hotel in central Seoul.
Lotte Group Chairman Shin Dong-bin apologizes at a press conference at Hotel Lotte in central Seoul on Oct. 25. Lee Sang-sub/The Investor
The chairman also vowed to push ahead with the US$4.5 billion initial public offering of Hotel Lotte, the de facto holding company of Lotte Group, on the local bourse.
“By opening up the company to domestic and overseas investors, we will diversify the shareholder base to get a foothold as a global corporation,” he said.
He added Lotte will beef up investments into hotel and duty-free businesses for its global expansion, hinting at acquisition of smaller rivals overseas.
On the day, Lotte also unveiled reform plans to improve corporate transparency by creating a compliance committee directly under the chairman’s control. The group’s policy coordination unit that has been blamed as the source of irregularities is also likely to be downsized.
It is the second time the Lotte chairman has issued a public apology after he became embroiled in a bitter succession feud with his older brother Shin Dong-joo in August last year.
On Oct. 19, the Seoul Central Prosecutors’ Office indicted the brothers and their father -- group founder Shin Kyuk-ho -- without detention on charges of embezzlement and corruption, wrapping up a four-month-long investigation into the country’s fifth-largest conglomerate.
By Ahn Sung-mi (firstname.lastname@example.org