Hi-mart’s three largest shareholders including Eugene Corp had agreed to sell a combined 65.3 percent stake in South Korea’s
largest electronic retailor to Lotte.
Last week, Lotte was picked as the preferred bidder to acquire the stake after MBK Partners walked away. Ahead of Samsung Digital, Hi-mart operates about 290 stores and controls 35 percent of the market. Using Lotte’s multiple retail channels, the two companies can achieve economics.
When Lotte was announced the preferred bidder, shares in Hi-mart closed 11 percent higher. Hi-mart‘s stock had previously lost as much as a fifth of its value after bidding closed on June 20, which would have made it tough for MBK to sell the deal to its investors. MBK would have booked a large immediate loss on the Hi-mart deal.
Hi-mart shares were suspended in April and the sale brought to a halt when Hi-mart’s chief executive, Sun Jong-koo, and others were charged by prosecutors for neglecting their duties and embezzlement totaling $228 million. Trading resumed on May 2.
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