Confectionery officially consolidated Lotte Food on July 1, resulting in the merged entity ranking second in the food market with a combined 3.7 trillion won in annual sales.
Lotte Confectionery said virtually all official procedures for Lotte Confectionery’s absorbing Lotte Food has been wrapped up.
Lotte Confectionery was to convene a board of directors meeting on July 5 to complete decision-making on the operation of the merged entity, including a structural reorganization and personnel reshuffles.
Lotte Confectionery President-CEO Lee Yeong-gu delivers his commemorative speech at a ceremony to inaugurate the merger entity of Lotte Confectionery and Lotte Food.
Lotte Confectionery President-CEO Lee Yeong-gu will head the merged entity, while former president Lee Jin-sung of Lotte Food will serve as an inside director - temporarily in charge of the food business, such as dairy products, home meal replacements and infant and child foods.
Major posts, including sales and marketing, had been already consolidated.
As a result, Lotte Food management executives and staff had moved to Lotte Confectionery’s headquarters in Yeongdeungpo-gu, Seoul.
The name of the merged entity will remain Lotte Confectionery. Lotte Food production plants will change the label of products from Lotte Food to Lotte Confectionery, depending on the inventory levels, and some products have begun to carry the label Lotte Confectionery from July 1.
Three businesses: ice cream, e-Commerce and overseas business have been consolidated and unified.
In particular, the merger catapulted Lotte Confectionery to rank first in the ice cream market. Figures, released by Food Information System, showed that Lotte Confectionery took up a 30.6 percent share in the ice cream market, and Lotte Food, a 14.7 percent share.
If the market shares of the two companies are combined, the merged entity will see its market share surge to 45.2 percent, beating Binggrae.
Binggrae took up the No.1 position in the ice cream market, with a combined market share of 40.2 percent after acquiring Loot Ice Cream.
With the latest merger, attention from the food industry is on how Lotte Confectionery would execute strategies to have synergetic effects.
With the merger, Lotte Confectionery has now become No. 2 food maker in Korea, following CJ Cheiljedang.
The new entity plans to ramp up competitiveness in all business areas by raising the efficiency of businesses by disbanding and consolidating structural entities and brands.
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