Lotte Group, which earlier this week scrapped what might have been the world’s biggest initial public offering (IPO), said more of its deals are under threat as the fallout spreads from widening investigations into the South Korean conglomerate.
The probes have disrupted business activities, while negotiations with companies in North America and Europe have been halted or delayed indefinitely, the group said in a statement.
For example, its Hotel Lotte Co unit was in discussions with as many as five companies from Europe, the US and Australia, but such large investments are now difficult to make in light of the probes and the shelved IPO, it said.
The group, still reeling from a feud that tore its founding family apart last year, sank into deeper turmoil on Friday last week as South Korean prosecutors widened probes into the business empire amid allegations of slush funds and embezzlement. The probes led its hotel unit to end a potential US$4.5 billion IPO, while its chemicals arm withdrew plans to buy Axiall Corp.
Hotel Lotte ended talks to buy a US duty-free-shop operator valued at about 1.7 trillion won (US$1.4 billion) and gave up on deals to buy hotels in the US and France, Yonhap news agency reported yesterday, without citing anyone or naming the target companies.
Lotte Group’s plans to buy Hyundai Logistics Co has also been suspended and one of its units canceled a bond sale, Yonhap said.
Lotte had been planning to use about 1.79 trillion won of the proceeds from the hotel unit’s IPO for acquisitions, according to the statement.
Meanwhile, the raids continued. Lotte Engineering & Construction Co’s offices in Seoul were among 15 Lotte-linked locations searched yesterday as prosecutors launched a second round of raids, according to Yonhap.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
ARTIFICIAL INTELLIGENCE: The chipmaker last month raised its capital spending by 28 percent for this year to NT$32 billion from a previous estimate of NT$25 billion Contract chipmaker Powerchip Semiconductor Manufacturing Corp (力積電子) yesterday launched a new 12-inch fab, tapping into advanced chip-on-wafer-on-substrate (CoWoS) packaging technology to support rising demand for artificial intelligence (AI) devices. Powerchip is to offer interposers, one of three parts in CoWoS packaging technology, with shipments scheduled for the second half of this year, Powerchip chairman Frank Huang (黃崇仁) told reporters on the sidelines of a fab inauguration ceremony in the Tongluo Science Park (銅鑼科學園區) in Miaoli County yesterday. “We are working with customers to supply CoWoS-related business, utilizing part of this new fab’s capacity,” Huang said, adding that Powerchip intended to bridge
Microsoft Corp yesterday said that it would create Thailand’s first data center region to boost cloud and artificial intelligence (AI) infrastructure, promising AI training to more than 100,000 people to develop tech. Bangkok is a key economic player in Southeast Asia, but it has lagged behind Indonesia and Singapore when it comes to the tech industry. Thailand has an “incredible opportunity to build a digital-first, AI-powered future,” Microsoft chairman and chief executive officer Satya Nadella said at an event in Bangkok. Data center regions are physical locations that store computing infrastructure, allowing secure and reliable access to cloud platforms. The global embrace of AI
Qualcomm Inc, the world’s biggest seller of smartphone processors, gave an upbeat forecast for sales and profit in the current period, suggesting demand for handsets is increasing after a two-year slump. Revenue in the three months ended in June will be US$8.8 billion to US$9.6 billion, the company said in a statement Wednesday. Excluding certain items, earnings will be US$2.15 to US$2.35 a share. Analysts had projected sales of US$9.08 billion and earnings of US$2.16 a share. The outlook signals that the smartphone market has begun to bounce back, tracking with Qualcomm’s forecast that demand would gradually recover this year. The San