GS25 Reacquires Subway Line 7 Operation Rights... Up to 10 Years of Management

[Asia Economy Reporter Seungjin Lee] Convenience store GS25 has reacquired the convenience store business rights for Subway Line 7. With the operating rights for a total of 40 stores, it was able to maintain its position as the number one in terms of the number of stores.

According to the industry on the 14th, GS25 won the business rights for 40 stores by bidding the highest price of 27,527,385,600 KRW in Seoul Metro's "Subway Line 7 Convenience Store Brand Specialty Store Lease" auction.

At the end of last year, Seoul Metro announced a bid for the "Subway Line 7 Convenience Store Brand Specialty Store Lease." The bid was to select an operator to lease and operate 40 convenience stores for five years. The minimum bid amount was 21,174,912,000 KRW, and GS25 bid about 6.4 billion KRW more.

Two companies, GS25 and 7-Eleven, participated in this bid. CU and Emart24 did not participate.

Subway Line 7 stores have been operated by GS25 for the past 10 years. GS25 paid a total of about 21.1 billion KRW in rent over the last five years of the contract period. The bidding condition is a contract period of five years, with the possibility to extend the contract for another five years, allowing operation for up to 10 years.

Meanwhile, GS25 surpassed CU last year to become the company with the largest number of stores. As of the end of November 2019, GS25 operated 13,899 stores, surpassing CU (13,820 stores), which had maintained first place for 17 years. The difference in the number of stores between the two companies is 79.

A GS25 official explained, "Since we are currently operating stores on Line 7, we were able to accurately analyze profitability," adding, "We acquired the business rights considering individual profitability rather than external expansion."

This content was produced with the assistance of AI translation services.