South Korea-based Lotte Rental is to purchase an additional 587,413 shares in Socar its main competitor — for KRW26.5 billion ($20.5 billion U.S.), bringing its stake in the latter to 34.7%.

Established in 1986 as a subsidiary of Lotte Group, Lotte Rental offers integrated mobility services, encompassing the buying and selling of used cars, including auctions, long-term rentals and leasing. It is seeking to increase its share of the b-to-c used car market to 10.0% by 2025.

Lotte Rental expects to close the sale by Dec. 24. It initially invested $152 million in Socar in March 2022 and has gradually increased its holding since then.

This deal will Lotte Rental the second-largest shareholder in Socar, behind Soqri and related parties, which have a 36.0% stake. Lotte Rental purchased the additional shares from Soqri, reducing the latter’s stake in the company from 37.8%. Both Lotte and Soqri are listed.

According to Lotte Rental, the deal represents the exercise of a put option by Sopoong Ventures.

While some observers think Lotte Rental’s growing stake in Socar makes friction with Soqri over the management of Socar more likely, both companies are playing down the possibility.

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