This article was displayed on the ChosunBiz MoneyMove (MM) site at 10:58 a.m. on Mar. 30, 2026.
Global private equity fund (PEF) manager Affinity Equity Partners (hereafter Affinity) has begun renegotiations with Lotte Group to lower the acquisition price of Lotte Rental. Faced with a situation in which it must sell SK Rent-a-Car at a low price to clear the Korea Fair Trade Commission's threshold, the strategy is to offset the loss that would arise there by cutting the per-share acquisition price for Lotte Rental.
According to the investment banking (IB) industry on the 30th, Affinity recently proposed a downward adjustment of the Lotte Rental acquisition price to Lotte Group and is in detailed talks. It is said that it has not yet submitted remedies to the Korea Fair Trade Commission (FTC).
The trigger for the renegotiation is the Korea Fair Trade Commission's merger review result. At the end of Jan., the commission said it would not approve Affinity's acquisition of Lotte Rental. According to the industry, the commission demanded a structural remedy that said, "If you want to acquire the No. 1 player Lotte Rental, sell 100% of the equity in the No. 2 player, SK Rent-a-Car," but Affinity did not accept it, and ultimately did not obtain the commission's approval.
It is reported that Affinity has concluded that selling SK Rent-a-Car is unavoidable to complete the acquisition of Lotte Rental.
The issue is SK Rent-a-Car's valuation. In 2024, Affinity bought 100% equity in SK Rent-a-Car for about 820 billion won, and at the time there was considerable controversy in the market that the price was excessively high relative to performance. Considering SK Rent-a-Car's performance and asset profile, the view was that 600 billion won was the upper limit even with a generous assessment.
As a result, if Affinity is to sell SK Rent-a-Car quickly, a loss of up to hundreds of billions of won is inevitable. In that case, however, it would inevitably face strong backlash and accountability issues from limited partners (LPs) who indirectly hold equity in SK Rent-a-Car through the fund.
Therefore, from Affinity's standpoint, it is said to have judged that the best course is to make up for the loss from the sale of SK Rent-a-Car by securing a lower per-share acquisition price for Lotte Rental.
Affinity has agreed to acquire Lotte Rental shares at 77,115 won per share. For Lotte Group, that amounts to a management control premium of more than 160% over the then-market price (29,000 won). The current share price is fluctuating around the 30,000-won level.
Affinity is said to be arguing for a lower acquisition price for Lotte Rental on the grounds of the "loss of synergy." The claim is that the price initially proposed for Lotte Rental was set on the premise of market power and operational efficiencies that would arise from owning both the No. 1 and No. 2 players (Lotte and SK).
Lotte Group is said to be weighing Affinity's proposal. With the sale of Lotte Rental crucial for groupwide liquidity and business restructuring, it cannot simply stick to the original valuation.
Another factor deepening Lotte Group's dilemma is that, given current market conditions, it would be hard to find another buyer willing to match the price Affinity offered. From Lotte's standpoint, it is likely to judge that even with some price concessions, getting the deal done would be more beneficial.
Both sides are strongly committed to completing the deal. A Lotte Group official said, "For now, there is no change in our intention to continue discussions with Affinity."