Shares of Lotte Shopping are plummeting following news that Shin Dong-bin, chairman of Lotte Group, plans to sell part of his stake to secure cash liquidity. The significant stake sale has raised concerns about potential oversupply, dampening investor sentiment.
As of 10:05 a.m. on July 23, Lotte Shopping shares were trading at 124,100 won, down 10,300 won (7.66%) from the previous trading day. At one point, the stock fell by as much as 12.12%, reaching 118,100 won.
According to the Financial Supervisory Service's electronic disclosure system, Shin announced plans to sell 324,100 common shares of Lotte Shopping, which represents 1.15% of the company's total shares.
The sale is scheduled to take place from August 21 to September 18. Depending on market conditions, block trades may also be conducted. The expected selling price is based on the closing price of 130,400 won on July 21, which would yield an estimated transaction value of approximately 42.2 billion won.
Given the substantial volume of shares Shin intends to sell, there is growing apprehension about the supply pressure on the stock price. The actual sale is set to begin next month, leading to concerns that the market may be preemptively reacting to the anticipated influx of shares. However, the actual transaction volume and price may vary based on market conditions at the time of sale.
If the transaction proceeds as planned, Shin's holdings in Lotte Shopping will decrease from 2,893,049 shares to 2,568,949 shares, reducing his ownership stake from 10.23% to 9.08%.
Shin stated that the purpose of the stake sale is to secure cash liquidity. If the sale goes through as planned, he will raise approximately 4.23 billion won.
* This article has been translated by AI.
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