TOKYO -- FamilyMart announced Friday that it is withdrawing from the South Korean market, citing tougher regulations on store openings, hours, and other aspects of the franchise chain business.
The Japanese retailer has a 25% stake in BGF Retail, a Seoul-based company that operates the FamilyMart franchise chain in South Korea. BGF Retail is slated to have an initial public offering on the Korea Exchange in mid-May, at which point FamilyMart will sell its entire stake.
FamilyMart first entered South Korea in 1990, concluding a franchise chain agreement with vending machine operator Bokwang Group. The company had 7,925 "CU with FamilyMart" stores as of the end of February, the most of any convenience store chain there.
But BGF Retail began rebranding stores away from the FamilyMart name in June 2012. This rift with the independent-minded local partner is thought to have contributed to FamilyMart's decision to leave South Korea.
Despite withdrawing from the country, which accounts for 60% or so of its foreign store count, FamilyMart plans to redouble efforts in Thailand, Indonesia, and other parts of Southeast Asia. FamilyMart says it may consider re-entering South Korea in the future.