Top department store operator Lotte Shopping is nearing a deal to acquire unlisted company Woori Homeshopping, according to press reports.

Lotte, South Korea's biggest retailer in terms of market value, is now in the final stages of talks to take over a 53% stake in Woori, it was reported.

The purchase price will be about KRW420bn (US$439.9m), Maeil Business Newspaper said.

Woori, South Korea's fourth-biggest home shopping company, reported sales of KRW573bn and operating profit of KRW64bn in 2005.

Woori's current largest shareholder, Kyungbang, is rumoured to be willing to sell off its stake in order to finance a new shopping mall.

Analysts, however, are concerned that Lotte might not benefit enough from the proposed deal because of high takeover expenses.