Homeplus decides to shut 37 idled stores, launch voluntary redundancy program

A Homeplus store in Seoul. [Herald DB]
A Homeplus store in Seoul. [Herald DB]

Homeplus has decided to permanently close all 37 of its hypermarket stores currently suspended nationwide, the company confirmed Thursday. A voluntary redundancy program will also be offered to employees working at those locations.

Homeplus management notified the Homeplus chapter of the Mart Industry Labor Union and a general labor union Thursday via official correspondence that it had decided to permanently close the 37 stores idled due to low performance, according to industry sources. The company had suspended operations at the 37 underperforming stores starting May 10 to normalize business operations and secure liquidity.

Homeplus said it plans to apply an asset liquidation store support system to employees at the 37 stores slated for closure. Workers at the rank of team leader or above will be eligible for the voluntary redundancy program, while employees with less than six months remaining until mandatory retirement will be excluded.

This marks the first time Homeplus management has officially acknowledged plans to close the 37 suspended stores and pursue voluntary redundancies. The measures were also reportedly included in a revised rehabilitation plan shared at a creditors' committee briefing held May 29.

Homeplus said the asset liquidation support system and voluntary redundancy program "can only be applied if the creditors agree to an emergency operating loan and an extension of the rehabilitation proceedings, given the depletion of operating funds." The company added that the situation "is deteriorating due to delays in lending by the creditors," and that "the only viable path to rehabilitation is a sale to a third party with guaranteed financial capacity and management capability, as was the case with Express."

The company went on to say that "above all else, normalizing operations at core stores and restoring competitiveness to previous levels is critical for a pre-approval merger and acquisition to succeed."


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