Shin Yoo-yeol (38), the eldest son of Lotte Group Chairman Shin Dong-bin and Executive Vice President of Lotte Corporation, was elected on June 26 to the board of directors of Lotte Holdings in Japan, which sits at the apex of the group’s governance structure. This move is seen as part of the conglomerate’s succession plan, soft-launching the third generation of management.
Shin has been actively engaging in global activities, solidifying his position as a successor by focusing on both the group’s future ventures in batteries and its core business in retail. As he bridges the gap between Lotte operations in South Korea and Japan, his future endeavors are drawing significant attention.
Last year, Shin was promoted to Executive Vice President of Lotte Corporation. He was appointed as an inside director of Lotte Biologics during the regular executive reshuffle in February, marking his entrance into the forefront of Lotte Group’s management in Korea. He currently serves as the head of Future Growth and Strategy at Lotte Corporation and the head of Global Strategy at Lotte Biologics, playing a crucial role in identifying new future business opportunities.
This year, Shin made his debut on the shareholder register of a listed Korean Lotte Group company by purchasing approximately 195 million won ($140,287), representing 0.01% of common stock in Lotte Corporation. Additionally, with his military service obligations set to end this year, there is speculation that he might soon acquire Korean citizenship.
Following these developments, Shin has been actively engaging in global activities, covering the group’s primary retail business and future ventures. He attended the opening ceremony of Lotte Hotel’s L7 Chicago in the U.S. on June 14, and he visited Lotte Energy Materials’ booth at InterBattery Europe 2024 in Germany on June 20. Lotte Group has identified the secondary battery materials business as a strategic area to offset its sluggish chemical business. Last year, Lotte Group acquired Iljin Materials (now Lotte Energy Materials) for 2.7 trillion won, marking its official entry into the secondary battery materials business. Lotte Energy Materials has been producing copper foil in Malaysia since 2019.
Shin is responsible for new business development within Lotte Group. Early on, Lotte Group identified bio and wellness, mobility, sustainability, and new life platforms as new growth engines and appointed him to lead these initiatives. Analysts suggest that Shin is receiving intensive training as a successor by identifying future growth engines within the group’s main businesses, including chemicals and hotels.
However, the issue of equity ownership, crucial for management succession, remains unresolved. Shin holds limited equity in key Lotte companies in both Korea and Japan. The initial public offering (IPO) of Hotel Lotte is expected to be a critical juncture for equity acquisition.
Apart from the largest shareholder, Japan’s Lotte Holdings (19.07%), seven Japanese investment companies hold 46.13% of Hotel Lotte’s shares as of the end of March this year. Lotte Strategic Investment (LSI), headed by Shin, owns 100% of these investment companies’ shares. If Hotel Lotte goes public, Shin’s control within the group is likely to increase. Hotel Lotte holds an 11.10% stake in Lotte Corporation, which is at the top of Lotte Group’s governance structure, and more than 30% stakes in Lotte Engineering & Construction, Lotte Property & Development, Lotte Aluminum, and Lotte Capital. However, Lotte Corporation has stated that if Hotel Lotte goes public and sells existing shares, LSI’s control in Korea could weaken.
