Lotte Group agreed to sell its car rental division to Affinity Equity Partners for 1.6 trillion won ($1.2 billion), offloading a profitable business as the South Korean conglomerate shifts focus to technology investments.
The Hong Kong-based private equity firm will acquire a 56.2% stake in Lotte Rental from Hotel Lotte and Busan Lotte Hotel, according to a memorandum of understanding signed December 6. The deal follows Affinity’s August purchase of SK Rent-a-Car, though the two companies will operate separately for three years.
The sale comes as Lotte restructures under an emergency management system implemented in August. While Lotte Rental leads South Korea’s car rental market, the business no longer aligns with the group’s strategy to expand in mobility technology, electric vehicle charging and autonomous driving.
Lotte plans to use proceeds to pay down debt and fund global expansion. The company said it selected Affinity partly based on commitments to maintain stable employment at the rental unit, which will continue using the Lotte brand during the transition period.
The conglomerate is selling non-core assets while targeting investments in biotechnology and artificial intelligence as it adapts to technological changes reshaping traditional industries.
