Despite concerns over retaliation from China, the Lotte Group is expected to provide the Seongju Golf Course as a site for the THAAD (terminal high-altitude area defense) System as agreed with the South Korean Ministry of National Defense. It is said that inside the Lotte Group, there are still concerns about damage to the group’s Chinese business but Lotte has decided to make good their promise as it was requested for national security.
Terminal High Altitude Area Defense"After an internal evaluation and analysis of the value of military land in Namyangju, Gyeonggi Province to be exchanged for Seongju Golf Course and its utilization plan, Lotte Corp, the owner of the golf course, will hold a board of directors meeting,” said a senior representative of the Lotte Group on January 20. "The board will carefully examine its feasibility and decide whether to approve it."
The book value of Seongju Golf Club (148,000 ㎡) is 85 billion won and its official land price 45 billion won while the official land price of Namyangju Military Site (200,000 ㎡) 140 billion won. The Ministry of National Defense will transfer some of the military site to the Lotte Group in consideration of the difference between the prices.
Lotte is expected to conduct a feasibility study on the site exchange as precisely as possible, even if it takes some time before holding a board meeting, because the Commercial Act demands a clear ground for the approval of the board and an issue of a breach of trust should be considered. Lotte and the Ministry of National Defense agreed on the exchange of the Seongju Golf Course with the Namyangju military land in November last year and completed an appraisal of the site by the end of last year. A delay of the exchange contract originally expected to be signed in January is raising a possibility that the agreement will be scrapped.
"We will proceed according to due process in terms of procedures and contents," said a representative of Lotte. "It will take more than two weeks to carry out the feasibility study among others so this issue will be concluded by next month."