The chief of South Korean business group Lotte said Sunday he will faithfully cooperate with a prosecutor probe into allegations that the group created illegal slush funds and conducted shady business practices.

"I will fully cooperate (with the investigation)," Lotte chairman Shin Dong-bin told reporters upon arrival at an airport in Seoul.

His remarks came as Lotte, South Korea's fifth-largest conglomerate, has come under a high-profile investigation since early June involving prosecutor raids of the group's affiliates.

Lotte, which has sprawling businesses in both South Korea and Japan, has been riddled with a series of scandals since last year including a fight between two brothers for managerial control.

The probe has hindered the group's major business projects, prompting cancellation of the initial public offering of Hotel Lotte, one of the group's key affiliates, initially slated for June.

The IPO of the hotel and duty-free operator was the key reform pledge that the Lotte chairman made to improve the murky governance structure of the business group following a succession battle with his elder brother.

Last Saturday, the group's chairman won the support of the Japanese shareholders of Lotte Holdings, the group's de facto holding company, for the third time, cementing his hold on Lotte in a power struggle with his elder brother Dong-joo, the former vice president of Lotte Holdings. (Yonhap)