Major Merger Reshapes South Korea’s Theatrical Landscape

JoongAng Group and retail giant Lotte Group have struck a significant deal that is set to transform the theatrical landscape in South Korea dramatically.

Creating the Nation’s Largest Cinema Chain

On Thursday, the two media and retail powerhouses signed a memorandum of understanding to merge their cinema chains—Megabox and Lotte Cinema—resulting in the largest theatrical exhibition entity in the country.

Joint Venture for Future Growth

This joint venture, which will be co-managed by both companies, aims to accelerate new investment opportunities and secure approval from the Fair Trade Commission, as announced by JoongAng Group.

Strengthening Competitiveness

“The agreement was reached following discussions aimed at enhancing competitiveness and ensuring long-term sustainability in their cinema and film businesses,” stated JoongAng Holdings, the group’s holding company, in an official announcement reported by Yonhap.

Ownership Stakes

Contentree JoongAng, the entertainment arm of JoongAng Group, currently holds a 95.98% stake in Megabox JoongAng, while Lotte Shopping owns an 86.37% share in Lotte Cultureworks.

Revitalizing the Film Industry

The theatrical exhibition sector in South Korea is still grappling with challenges in recovering from the pandemic, but both groups are optimistic that their combined strengths will help rejuvenate the domestic film industry.

Market Position and Screen Count

According to data from the Korean Film Council, while market leader CGV operates 1,346 screens nationwide, the newly merged entity will leap to the forefront with a total of 1,682 screens—comprising Lotte Cinema’s 915 and Megabox’s 767.

Beyond Theatrical Exhibition

This merger extends beyond just theatrical exhibition. Lotte Cultureworks boasts a diverse portfolio that includes Lotte Entertainment, a major player in distribution and investment, as well as the Charlotte musical theater chain. Meanwhile, Megabox JoongAng oversees PlusM Entertainment (a film investor and distributor) and Playtime JoongAng, which operates indoor children’s playgrounds.

Impact on Film Distribution

The merger may also influence the distribution landscape, as both Lotte Entertainment and Megabox’s PlusM Entertainment are key players in South Korea’s film distribution sector, competing alongside CJ ENM, Showbox, and New.

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