Lotte chief eyes biotech, metaverse, hydrogen, batteries as new growth engines

Lotte Group Chairman Shin Dong-bin speaks at an opening ceremony of Lotte Mall West Lake Hanoi, Vietnam, Sept. 22. Yonhap

Lotte Group will realign its business portfolio to focus on four major new growth engines — bio technology, metaverse, hydrogen energy and secondary batteries — and take preemptive steps to sell its non-core businesses to maximize management efficiency, Chairman Shin Dong-bin said.

In an interview with the Yomiuri Shimbun, a Japanese newspaper, Shin shared its group-wide strategy of bolstering core businesses with huge growth potential, while at the same time selling unprofitable ones, in a bid to streamline its portfolio amid escalating global economic uncertainties.

“We are pushing for business expansion in the four new growth areas, and have plans to sell some of our less lucrative businesses down the road,” Shin told the Japanese newspaper, Tuesday. “Lotte has acquired a group of around 60 big and small firms, but now we have shifted our strategic focus in a way to focus more on some core businesses, so we can develop our overall portfolios.”

Last year, Lotte sold its Lotteria fast food business in Japan to Zensho Holdings which operates diverse restaurant chains there. The decision came in reaction to Lotteria’s sluggish performance, as it struggled to expand its market share there.

Lotte Chemical also decided to sell a controlling stake of its subsidiary in Pakistan to a local chemical firm there.

But the group is moving to boost investments in its next growth areas. For instance, Lotte Biologics acquired U.S. drug firm Bristol Myers Squibb at $160 million (212.6 billion won) last year, as part of its ambitious vision to join the world’s top 10 contract development and manufacturing organizations (CDMO) by 2030.

The company also launched Lotte Energy Materials after taking over Iljin Materials, with an aim to expand its presence in the market for secondary battery materials.

Shin Yoo-yeol, the eldest son of the Lotte chief, was also promoted to the head of Lotte Group's future growth division during its year-end reshuffle, in a display of the group’s strong willingness to place more strategic focus on finding its next revenue generators.