[비즈한국] While the local community in Daegu has been buzzing with reports that the Japanese large-scale discount chain 'Don Quijote' would open a store in the main building of the Daegu Department Store, a local landmark, the operator of Don Quijote has denied that any such expansion is under review. As questions arise regarding the acquisition plan for Daegu Department Store—which relied on the draw of Don Quijote—attention is now focused on the financial capability of the prospective buyers, Saekyung Invest and Aram Korea, and whether they can successfully complete the acquisition.
On the 4th, the public relations office of Pan Pacific International Holdings (PPIH), the Japanese operator of Don Quijote, responded to inquiries from Bizhankook regarding their entry into the Korean market and potential site inspections in Daegu, stating, "The company is aware of the media reports in Korea," but adding, "However, there is no truth to the reports regarding the review of opening a store in Daegu or any on-site inspections by our management."
The news that Don Quijote, a favorite among Korean tourists in Japan, would enter Daegu had drawn significant interest both locally and nationwide. The fact that PPIH has stated they are not considering such an expansion is expected to cause a stir.
Don Quijote is a comprehensive discount chain operated by Japan’s PPIH, known for selling various items—including food, household goods, cosmetics, and electronics—at low prices, making it an "essential course" for trips to Japan. While it operates stores across Japan and in countries like the United States, Singapore, Hong Kong, and Thailand, it has not yet entered the Korean market.
The report of Don Quijote's entry into Korea was first announced by Saekyung Invest, the prospective buyer of Daegu Department Store’s shares. In a press release on July 28, Saekyung Invest stated, "We are in the process of fully promoting the entry of the Japanese retail giant Don Quijote into the main building of the Daegu Department Store," adding, "We recently sent a formal proposal regarding participation in the Daegu Department Store main branch to PPIH management. PPIH expressed a positive interest in participating, and we are currently coordinating a schedule for a visit to Korea to discuss specific contract procedures and entry methods."
Questions also remain regarding the party with whom they consulted. Although Saekyung Invest mentioned in their press release that they sent the proposal to PPIH's "Representative Director and President Naoki Yoshida," PPIH is currently led by President Hideki Moriya, and Don Quijote is led by President Kosuke Suzuki. According to PPIH's company profile, former president Naoki Yoshida held the position of representative for Don Quijote and PPIH starting in September 2019 and has served as a director since September 2025.
When asked about the response from PPIH and the entity involved in the acquisition review, Nam Seong-hak, Vice President of Saekyung Invest, replied, "We have not yet been formally notified of an official schedule (by PPIH)."
Established in 1969, Daegu Department Store is a local department store and retail company in Daegu. It has operated real estate leasing and mart chain businesses, with its main department store building located in the heart of Dongseong-ro, Daegu's largest commercial district. However, due to the dual pressures of the COVID-19 pandemic and the local economic downturn, it suspended operations at its main department store in July 2021. Since then, there have been several discussions about selling the property and management rights, but none have come to fruition.
The largest shareholder of Daegu Department Store is CEO Koo Jung-mo (73) and 15 specially related persons, who hold a 32.64% stake. On July 15, CEO Koo and 6 others signed a stock purchase agreement to sell a 25.82% stake (2,795,743 shares) to Saekyung Invest and Aram Korea, which would lead to a change in the largest shareholder. The transaction value is approximately 22.4 billion won, calculated at 8,000 won per share of Daegu Department Store common stock. Daegu Department Store is a KOSPI-listed company, and its closing price on the 4th was 4,885 won.
The buyers have paid a 1 billion won deposit and a 1.4 billion won first installment, with an 8 billion won second installment and a 12 billion won final balance remaining. The second installment is scheduled for August 14, and the transaction is expected to close on August 25. If the deal is completed, Saekyung Invest and Aram Korea will become the largest shareholders of Daegu Department Store.
Consequently, attention has turned to the identities of the new prospective buyers, Saekyung Invest and Aram Korea. Saekyung Invest is known to be a Special Purpose Company (SPC) established for the acquisition of Daegu Department Store shares. According to the corporate registry, Saekyung Invest was established on July 10, just before the stock purchase agreement, and has a capital of only 100 million won. Aram Korea is presumed to be a company based in Seongnam, Gyeonggi Province, with a capital of 50 million won and business objectives listed as entertainment, online product sales, and brokerage for domestic and overseas expansion.
The fact that Daegu Department Store carries significant debt also raises questions about whether the acquisition can be completed. Approximately 200 billion won in core real estate assets, including the Daegu Department Store main building and its subsidiary Daebak Plaza, are held as collateral by financial institutions. According to Daegu Department Store’s first-quarter report, it has 148.1 billion won in short-term borrowings and 100.1 billion won in current portion of long-term debt (long-term debt due within one year), indicating a substantial amount of debt that must be repaid in the near future.