Lotte Group said on the 30th that it will set up a joint venture in Singapore in early next month with Korea's Lotte Wellfood and Japan's Lotte Confectionery participating together.
The two corporations have completed board approvals and merger review procedures in the relevant countries, and the joint venture is set to launch officially next month. The chair of the new joint venture's board will be Shin Yoo-yeol, head of future growth at Lotte Corporation and the son of Lotte Chairman Shin Dong-bin.
The establishment of this joint venture is a case in which the "One Lotte strategy between Korea and Japan," pushed by Chairman Shin, has taken concrete shape in the institutional sector of food, the group's core business. Shin has regularly chaired the "One Lotte food companies strategy meeting," emphasizing the strengthening of global competitiveness through collaboration between the Korean and Japanese Lotte food affiliates. The judgment is that, as growth potential in the domestic markets of Korea and Japan slows, overseas business must be fostered as a new growth axis.
The two companies have expanded the scope of cooperation through raw material sourcing, joint marketing, and cross-selling of products. Based on this collaboration, Lotte Wellfood's overseas sales last year rose 14.4% from 2024 to 1.2047 trillion won. Japan's Lotte Confectionery also posted about 900 billion won in overseas sales, centered on Vietnam and Indonesia.
Pepero, selected by Lotte as its No. 1 global mega brand, is also showing standout overseas growth. As Korea and Japan Lotte strategically leveraged their overseas distribution networks, Pepero's overseas sales growth rate reached 24% last year and climbed to 33% in the first quarter of this year.
Through this joint venture, Lotte plans to raise the level of collaboration between the Korean and Japanese food affiliates by one notch. The new company will oversee the Asian businesses of the Korean and Japanese Lotte food companies. It will unify management control and decision-making systems that had been dispersed by business, and it will connect the two companies' production, sales, and logistics infrastructure to boost operating efficiency.
Shin Yoo-yeol, head of future growth at Lotte Corporation, will serve as chair of the new joint venture's board. Shin is expected to lead the creation of synergies between the Korean and Japanese food affiliates and to drive overseas business strategies.
The new joint venture plans to pursue the development of global mega brands; the streamlining of production and sales processes such as materials and supplies purchasing, logistics, and marketing; the launch of new products through joint research and development; and entry into new markets with high growth potential.
The establishment of the food joint venture is in line with the One Lotte strategy that is spreading across Lotte Group. To jointly promote the hotel business in Japan, Lotte set up the joint venture LOTTE HOTELS JAPAN in Sep. last year with Lotte Hotels and Resorts and Lotte Holdings in Japan participating. In addition, the two sides are continuing collaboration across various business areas, including attracting investment for Lotte Biologics and operating L-CAMP JAPAN by Lotte Ventures.
A Lotte official said, "With the establishment of this joint venture, we have brought together the capabilities of the Korean and Japanese Lotte food businesses in Asia," and added, "We will pool the strengths of both companies to jointly develop mega brands and pioneer new markets to enhance global competitiveness."