Hotel Lotte, Lotte Group's hotel unit, said Friday it has chosen three brokerages houses for its initial public offering, accelerating the group's move to improve its murky governance structure and transparency.

Seoul-based KDB Daewoo Securities, Bank of America Merrill Lynch's Merrill Lynch International & Co and Citigroup were selected to lead the listing process.

Korea Investment & Securities, Mirae Asset Securities of South Korea, Goldman Sachs and Nomura will advise the listing, the firm said.

Hotel Lotte has been preparing for its market debut since Lotte chairman Shin Dong-bin last month promised to improve corporate transparency by listing its affiliates and untangling the complex cross-shareholding structure. Lotte, the country's fifth-largest conglomerate, has come under growing pressure to bolster its transparency after a family feud between founder Shin Kyuk-ho and his two sons, Dong-joo and Dong-bin, shed light on its complex governance structure.

Hotel Lotte is 99 percent controlled by Japanese shareholders, including Tokyo-based Lotte Holdings and other unlisted Japanese companies.

Lotte has said earlier the hotel unit is expected to have a market capitalization of around 10 trillion won ($8.5 billion) when it lists, but market watchers estimate it could reach as much as 20 trillion won, considering its large stakes in affiliates and strong earnings.

Established in 1973, the hotel holds an 8.83 percent stake in Lotte Shopping, a 12.99 percent stake in Lotte Aluminum and an 18.77 percent stake in Lotteria.

Meanwhile, Lotte Holdings, the group's Tokyo-based holding firm, holds a 19.07 percent stake in Hotel Lotte, while group investment units called L Investment Company hold a combined 72.65 percent stake. (Yonhap)