Lotte is one of South Korea's largest diversified conglomerates, operating across multiple industries. It is best-known as one of Asia's leading confectionery companies, and among the global leaders in chewing gum. Brands include Xylitol and Fit's gum and mints; as well as Crunky and Ghana chocolate among many other products, including several under license from Nestlé. One of the group's few confectionery businesses operating in the West is Belgian chocolate manufacturer Guylian, acquired in 2008. Lotte is also a major force in food and soft drinks. It is one of the world's biggest manufacturers of ice cream (mainly in Asia) and a local giant in soft drinks as the Korean licensee for Pepsico and Del Monte fruit juice. Its own Chilsung Cider (non-alcoholic despite its name) is a long-established pillar of the Korean soft drinks industry. Lotte Asahi is a joint venture with Asahi Breweries of Japan to market that company's beers in Korea. Lotte is also South Korea's biggest retailer, operating a wide variety of different Lotte-branded stores including supermarkets, department stores and convenience outlets, as well as restaurants, hotels, theme parks and other leisure facilities. There are also industrial operations including petrochemicals production and construction. The group divested its financial services units in 2019 at a large loss in a bid to reform its complex corporate structure. Most of the marketing for the entire portfolio of companies is managed by another group subsidiary, Daehong Communications, which is now the country's #4 advertising agency. Lotte has established a strong presence in other Asian markets, especially Japan where the founding Shin family, who still control the group, have long-established roots, but also China, Malaysia and Indonesia. Unlike other Korean conglomerates such as Samsung or LG, Lotte has a very low profile in the West. The group's performance has been impacted since 2015 by a series of dramatic challenges, including ongoing power struggles between members of the founding family; a political row between Korea and China which resulted in a boycott of Lotte outlets by Chinese shoppers; and then the arrest and imprisonment during 2018 of chairman Shin Dong-bin on corruption charges. He was freed from prison at the end of the year. His elder brother Shin Dong-joo - ousted from the group in 2015 but still a major shareholder - continues to battle for greater control over the business, but investors and employee groups have consistently sided with the more stable leadership style of Shin Dong-bin. Their father, and Lotte Group's founder, Shin Kyuk-ho died in 2020. As a privately owned business, Lotte is secretive about its finances. Combined group revenues were around $76bn in 2019. A large proportion of group profits are funneled into grandiose construction projects, especially skyscrapers. The Lotte World Tower in Seoul is currently the world's 5th tallest building; others are under construction.
Capsule checked 2nd February 2021
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Adbrands Weekly Update 4th Jan 2018: South Korea's newly revitalised anti-corruption regulators scored another victory over the handful of families who have dominated that country's economy over the past 50 years. Hot on the heels of the imprisonment last year of Samsung heir JY Lee, a court found several members of the Shin family, who control the Lotte retail and confectionery empire, guilty of embezzlement and breach of trust. Lotte's 95-year-old founder Shin Kyuk-ho was sentenced to four years in prison; his son and current chairman Shin Dong-bin was given a 20-month suspended sentence. The Shin clan is accused of making payouts from Lotte Group to family members in the form of unearned salaries and preferential business rates. Other family members were also given sentences. Shin Dong-bin also faces a separate trial for bribing disgraced South Korean president Park, a similar case to that for which Samsung heir Lee Jae-yong is currently serving jail time. [UPDATE: In the latter case, Shin Dong-bin was found guilty of corruption in Feb 2018 and sentenced to two-and-a-half years in prison. He was released in Oct 2018 on a suspended sentence following an appeal].
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