Cash-strapped E-Land Group has put its flagship and highly profitable department store in southern Seoul on the auction block, a local report said Monday.
The retail giant, which has been trying to improve its finances through asset sales, took the decision as the ongoing sale of its hypermarket chain Kim’s Club has failed to draw interest from strategic investors like bigger retail giants Sinsegae, Hyundai Department Store or GS Retail.
A NewCore Department Store in Gangnam, southern Seoul (E-Land)
“E-Land will start anew the process to sell Kim’s Club and the Gangnam branch of the NewCore Department Store,” Yonhap news agency reported, citing an unidentified source from the local investment bank community.
Whether to make it a package sale or two separate deals is not yet decided, the sources said.
According to other sources, nearly 10 bidders participated in the preliminary auction of Kim’s Club last week, which through its 37 branches generates annual revenue of around 1 trillion won. All 10 are reportedly private equity funds, including U.S.-based KKR.
If the Gangnam branch of NewCore Department Store is sold along with the hypermarket chain, the deal could fetch as much as 2 trillion won ($1.6 billion), deal watchers said.
The department store up for grabs is located near the express bus terminal in the heart of Seoul’s posh Gangnam residential district.
By Lee Sun-young (milaya@heraldcorp.com)
