South Korea’s Lotte Cinema and Megabox, the second and third-largest cinema chains in the country, are set to merge in a bid to revitalise the str
South Korea’s Lotte Cinema and Megabox, the second and third-largest cinema chains in the country, are set to merge in a bid to revitalise the struggling local film industry.
Retail conglomerate Lotte Group and media giant JoongAng Group signed a memorandum of understanding (MOU) on Thursday (May 8) to merge their respective affiliates, Lotte Cultureworks and Megabox JoongAng.
The joint venture would be co-managed by both companies after undergoing a review from the Fair Trade Commission. In a statement, Lotte said they intend to move ahead with the review and attract investment for the venture “as quickly as possible”. Financial details have not been disclosed.
“The main goal of this merger is to establish a sustainable business environment by building a differentiated screening environment, investing in the stable Korean film market, and securing competitive content,” said a JoongAng Group spokesperson. “The ultimate goal is to revitalise the stagnant Korean film industry and provide quality service to customers.”
South Korea’s film industry has struggled to recover since the Covid-19 pandemic. Box office takings in 2024 totalled $812.3m, a 5.6% drop year-on-year. This came from 123 million admissions, a massive 45.6% drop on pre-pandemic 2019, which had ranked as the country’s all-time highest box office year in terms of admissions and gross. Conversely, streaming platforms in the country saw growth of 11% last year.
According to the Korean Film Council, Lotte Cinema operated 915 screens nationwide in 2024 while Megabox had 767. A merger would see this add up to 1,682 , surpassing current leader CGV, which operates 1,346 screens.
The merger would see the two companies strengthen the competitiveness of their existing theatre and film businesses and expand fresh businesses, according to a statement.
They intend to “maximize synergy” through the merger, securing financial stability by growing profits and attracting fresh investments while strengthening their own competitiveness in advertising sales and theatre operations by easing the competitive structure. In particular, they plan to further accelerate the development of special theatres to offer an experience that cannot be achieved by streamers.
As both companies are also involved in film production, investment and distribution, there are also plans for content investment.
Megabox JoongAng’s main businesses are theatre chain Megabox, investment and distribution company Plus M Entertainment and indoor kids’ theme park Playtime Joongang. Lotte Cultureworks’ main businesses are theatre chain Lotte Cinema, investment and distribution company Lotte Entertainment and the Charlotte Theater.
“Through the merger, we will strive to broaden content diversity, improve audience services and have a positive impact on the overall film industry ecosystem,” added a Lotte official.
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