[THE INVESTOR] Hyundai Department Store
appears to be ready to further strengthen its areas of core competence to pursue sustainable growth.
Officials of Hyundai Department Store already confirmed on Sept.20 that the retailer is undergoing discussions for acquiring SK Networks
Industry sources say the move is a part of chairman Chung Ji-sun
's vision for the future. “Hyundai Department appears to be looking to build up its exterior, particularly in terms of fashion,” said Kim Geun-jong, a researcher at Hyundai Securities.
Hyundai Department Store Chairman Chung Ji-sun
Chung proclaimed this year that through M&As, the firm will seek annual sales of 20 trillion won, and operating profit of 2 trillion won by 2020.
Recently, the department store made a bid for acquiring home appliance manufacturer Tongyang Magic. SK Networks also joined the race.
“Hyundai Department Store obviously is looking at M&As to shore up its competence,” said Kim. Related article : Hyundai to build Seoul’s largest department store in Yeouido
Should the merger with SK Networks go through, the department store would have a fashion business with annual sales of more than 1 trillion won (US$887.30 million).
The store's existing fashion business, Hansum, posted annual sales of 615.4 billion won in 2015. SK Networks recorded sales of 565.2 billion won in the same period.
Annual sales of over 1 trillion won would make Hyundai Department Store the fourth-largest fashion house in Korea, following E-Land, Samsung C&T and LF.
Hyundai Department Store acquired Hansum in 2012. On Sept. 20, Hansum said it signed a five-year 83.6 billion won deal for exporting some of its brands to China.
By Kim Ji-hyun (email@example.com