South Korea's Lotte Shopping Co Ltd has agreed to buy a controlling stake in Chinese supermarket operator Times, Lotte's parent firm Lotte Group said, confirming earlier media reports.
“We have in effect acquired Times, though some processes (to complete the deal) remain,” said a Lotte Group spokesman, who declined to be named.
“The pricing is seen close to the earlier reported $630 million to $650 million,” he added.
That would be above the $600 million offered by rival bidder Wumart, as reported by the Chosun Ilbo on Saturday.
Chinese retailer Wumart was in the final stages of talks to acquire smaller rival Times, sources said last month, after Times had invited a number of potential bidders as part of a strategic review.
Hong Kong-based Times operates hypermarkets and supermarkets, mostly in eastern China.
Lotte's confirmation of the Times buyout follows news late on Friday that Lotte Shopping would invest 733 billion won ($633 million) in its Hong Kong unit to help it expand in China and Hong Kong.
“The reported pricing seems a bit higher than markets had expected, but Lotte's China expansion is a long-term plan,” said Yoo Ju-yeon, an analyst at Meritz Securities.
“As Times is a solid, established retailer in China the acquisition is positive for Lotte from the long-term perspective,” she added.
Lotte, which operates department stores, supermarkets, and discount outlets in South Korea, is the country's biggest retailer after Shinsegae Co Ltd by market value. (Reuters)