Seoul: South Korea’s antitrust regulator announced Thursday it is reviewing the planned merger between the nation’s second and third largest theater chains. Media giant JoongAng Group and retail conglomerate Lotte Group have initiated this process by submitting a preliminary consultation request to the Fair Trade Commission (FTC) last month, following their memorandum of understanding (MOU) signed in May to merge their cinema chains-Megabox and Lotte Cinema.

According to Yonhap News Agency, the FTC’s preliminary consultation system was introduced last year to expedite mergers between companies. Should this merger be completed, it is anticipated to significantly alter the domestic cinema industry landscape, creating a two-horse race between CGV, the current market leader, and the newly formed entity.

As of 2024, data from the Korean Film Council indicates that CGV operated 1,346 screens across the country, more than any other cinema chain in South Korea. Lotte Cinema operated 915 screens, followed by Megabox with 767. If the merger proceeds, the combined number of screens managed by the new entity is expected to exceed that of CGV.

Industry observers are also monitoring the possible consolidation of Lotte Entertainment and PlusM Entertainment. Alongside CJ ENM, Showbox, and NEW, these companies are significant players in South Korea’s film distribution market.

“This is the first preliminary consultation case on a merger between conglomerates,” stated the FTC. “We will closely examine the impact of the merger on consumers and whether it may interfere with fair competition.”