Homeplus eyes reopening of closed stores after $135M Meritz loan deal
After a court dismissed the hypermarket's rehabilitation proposal, a last-ditch effort by the financial group and MBK Partners may allow operations to resume.
A passerby walks past a Homeplus store in Seoul on July 16.
NEWS1
Homeplus said Thursday it will reopen its temporarily closed stores if the rehabilitation court allows its restructuring process to continue after an immediate appeal.
"If the rehabilitation court extends the process following an immediate appeal, the hypermarkets that have been temporarily closed will establish reopening schedules in consultation with partner companies," Homeplus said.
The announcement came after Homeplus and Meritz Financial Group — the retailer's largest creditor — finalized an agreement Thursday under which Meritz will provide a 200 billion won ($135 million) emergency debtor-in-possession (DIP) loan after private equity firm MBK Partners, the majority owner of Homeplus, announced it would guarantee the entire amount earlier that morning. The Seoul Bankruptcy Court had proposed the financing as a condition for reconsidering its decision to terminate Homeplus's rehabilitation proceedings.
Thursday morning, MBK Partners and its chairman, Kim Byung-ju, announced a guarantee for the full amount of the emergency DIP loan to support the rehabilitation.
The retailer had been on the brink of bankruptcy until Wednesday, when Meritz expressed its willingness to provide the emergency loan on the condition that MBK Partners guarantee the entire amount, according to an industry source.
On July 3, the Seoul Bankruptcy Court terminated Homeplus's rehabilitation proceedings. However, it left open the possibility of reversing the decision if the retailer secures the 200 billion won and files an immediate appeal by Monday.
In a statement released Thursday, Homeplus said Meritz's approval of the 200 billion won DIP loan was "highly significant because it demonstrated that key stakeholders had reached a consensus on continuing the rehabilitation process."
Homeplus said its labor unions, MBK Partners and Meritz had agreed to move forward with the rehabilitation process through cooperation and mutual concessions.
"The mart workers' union and the general workers' union agreed to cooperate in minimizing the company's financial burden associated with the closure of 37 stores," Homeplus said.
BY SHIN HYE-YEON [[email protected]]
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
