Key Takeaways
- • TPG has secured exclusive due-diligence rights to acquire a controlling 61.2% stake in Lotte Rental, South Korea's largest vehicle-rental operator, in an all-equity deal valued at approximately $920 million (1 trillion won), with Korean reports placing potential pricing near 1.3 trillion won.
- • The stake is held by Hotel Lotte and Busan Lotte Hotel, Lotte Group subsidiaries that confirmed discussions with TPG in a July 1 regulatory filing, with no final agreement announced as of the reporting date.
- • Lotte Rental operates roughly 255,000 vehicles and commands approximately 20% of South Korea's domestic rental-car market, with 2025 revenue of 2.92 trillion won and operating profit of 312.5 billion won, demonstrating 4.5% revenue growth and 9.7% operating profit expansion year-over-year.
- • TPG outpaced competing global buyout firms—including KKR, Carlyle, Bain Capital, and EQT—in the acquisition race, leveraging existing South Korea mobility exposure through its Kakao Mobility investment.
- • A successful transaction would mark Lotte Group's second divestment attempt of the business and represent TPG's largest Korean acquisition to date, reviving the conglomerate's broader asset-sale strategy.
Summary
TPG, a global private equity firm, is pursuing exclusive control of Lotte Rental, South Korea's leading vehicle-rental and leasing operator, following the execution of exclusive due-diligence rights over a 61.2% controlling stake owned by Hotel Lotte and Busan Lotte Hotel. The proposed all-equity transaction is valued at approximately $920 million, with Korean market reports placing potential valuations closer to 1.3 trillion won. Lotte Rental disclosed the negotiations in a July 1 regulatory filing, confirming that controlling shareholders had engaged TPG regarding due diligence and potential share sales, while noting no final decision had been reached.
Lotte Rental represents a strategically significant asset within South Korea's automotive services sector. The company operates a fleet of approximately 255,000 vehicles and holds roughly 20% market share in the domestic rental-car market. Its business portfolio encompasses long-term and short-term vehicle rentals, fleet management services, car-sharing operations, and used-car sales. Financial performance has been robust: the company reported 2025 revenue of 2.92 trillion won with operating profit of 312.5 billion won, representing 4.5% year-over-year revenue growth and 9.7% operating profit expansion. First-quarter 2026 results showed accelerating momentum, with operating profit climbing 24.8% to 83.6 billion won.
TPG emerged as the frontrunner among competing international buyout sponsors, including KKR, Carlyle, Bain Capital, and EQT, positioning the acquisition as TPG's largest Korean transaction to date. The firm already maintains exposure to South Korea's mobility ecosystem through its investment in Kakao Mobility, though no operational partnership between Kakao Mobility and Lotte Rental has been announced. A successful completion would transfer South Korea's largest vehicle-rental and leasing operator to international private-equity ownership for the first time.
This transaction represents the second divestment effort by Lotte Group for the business. In March 2025, Hotel Lotte and Busan Lotte Hotel had previously agreed to sell a 56.2% stake to Affinity Equity Partners for 1.57 trillion won while retaining a 5% position, marking an earlier phase of the conglomerate's asset-rationalization campaign. The TPG pursuit thus forms part of Lotte Group's broader portfolio optimization strategy during a period of selective asset sales. No stock-purchase agreement has been finalized, and completion remains subject to final terms negotiation and regulatory approval.
Lotte Rental represents a strategically significant asset within South Korea's automotive services sector. The company operates a fleet of approximately 255,000 vehicles and holds roughly 20% market share in the domestic rental-car market. Its business portfolio encompasses long-term and short-term vehicle rentals, fleet management services, car-sharing operations, and used-car sales. Financial performance has been robust: the company reported 2025 revenue of 2.92 trillion won with operating profit of 312.5 billion won, representing 4.5% year-over-year revenue growth and 9.7% operating profit expansion. First-quarter 2026 results showed accelerating momentum, with operating profit climbing 24.8% to 83.6 billion won.
TPG emerged as the frontrunner among competing international buyout sponsors, including KKR, Carlyle, Bain Capital, and EQT, positioning the acquisition as TPG's largest Korean transaction to date. The firm already maintains exposure to South Korea's mobility ecosystem through its investment in Kakao Mobility, though no operational partnership between Kakao Mobility and Lotte Rental has been announced. A successful completion would transfer South Korea's largest vehicle-rental and leasing operator to international private-equity ownership for the first time.
This transaction represents the second divestment effort by Lotte Group for the business. In March 2025, Hotel Lotte and Busan Lotte Hotel had previously agreed to sell a 56.2% stake to Affinity Equity Partners for 1.57 trillion won while retaining a 5% position, marking an earlier phase of the conglomerate's asset-rationalization campaign. The TPG pursuit thus forms part of Lotte Group's broader portfolio optimization strategy during a period of selective asset sales. No stock-purchase agreement has been finalized, and completion remains subject to final terms negotiation and regulatory approval.
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