Hotel Lotte IPO expected to become S. Korea's biggest offering

SEOUL, May 19 (Yonhap) -- South Korean retail giant Lotte Group's hotel unit said Thursday it will go public on the KOSPI market on June 29, which is expected to fetch over 5 trillion won (US$4.19 billion) to mark as the nation's largest-ever initial public offering (IPO).

Hotel Lotte Co. said in a regulatory filing that it will offer 47.85 million shares at a range between 97,000 won to 120,000 won per share.

The offering is estimated to be around 4.6 trillion to 5.7 trillion won, and its medium range of price would surpass the record amount of 4.9 trillion sale by Samsung Life Insurance Co. in 2010.

Hotel Lotte, the world's No. 3 duty-free operator, said it will use the fund to step up its duty-free business, hotel chain and theme park to offer comprehensive options to travelers.

"Hotel Lotte will use the IPO fund to invest in expansion of duty-free stores at home and abroad to become the world's largest duty-free operator," the company said in a statement.

The duty-free business is the company's key source of income, accounting for 86 percent of its total sales.

Starting from next month, Hotel Lotte plans to hold a series of deal roadshows in major cities, including New York, London, Singapore and Hong Kong, according to company officials.

The listing of Hotel Lotte is one of the reform pledges that Lotte Group Chairman Shin Dong-bin has made as part of efforts to improve corporate image after a bitter family feud for control of the retail-focused conglomerate, which has sprawling businesses both in South Korea and Japan.

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