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'S Korea's Lotte to Set up Discount Stores in Vietnam
SEOUL, Nov 6 Asia Pulse - Lotte Shopping Co., the operator of South Korea's largest department store chain, said on Monday that it plans to set up a joint-venture discount store unit in Vietnam to make a foray into the wholesale and retail business in the Southeast Asian country.
Lotte Shopping will establish Lotte Vietnam Shopping Co., capitalized at 14.1 billion won (US$14.9 million), with Vietnam's Minh Van Manufacture Trade Private Enterprise.
Lotte, however, gave no time frame for the establishment of the joint venture.
The joint venture will be 80 per cent owned by Lotte and the rest by the Vietnamese firm. Lotte Shopping plans to maintain the joint partnership for 50 years, it said.
"The Vietnamese government gave the investment the green light, which paves the way for Lotte Shopping to enter the discount store business in Ho Chi Minh City," a company official said.
Lotte Shopping said its third-quarter net profit rose 57.2 per cent to 167.04 billion won from a year ago.
Lotte has signed a joint venture contract with Vietnam's Minh Van Manufacture Trade Private Enterprise in December and plans to invest $15 million to establish Lotte Vietnam Shopping Co., the company said in a statement.
The first store is planned for Ho Chi Minh City in the first half of 2008, Lotte said. It plans up to 20 stores in major cities including Hanoi in the longer term, it said.
Lotte, South Korea's largest department store operator, is venturing overseas at a time when fierce competition and slowing consumer demand are pressuring margins in the country's mature $120 billion retail industry.
The company runs the third-biggest discount store, Lotte Mart, in South Korea and aims to open a department store in Moscow by the end of the year.Source(s): 網路及自己於越南經商