Some suppliers resume deliveries backed by NS Shopping payment guarantee; full recovery expected after June 22 acquisition close; Homeplus says remaining business units will also rebound once supply normalizes

A Homeplus Express store in central Seoul [Herald DB]
A Homeplus Express store in central Seoul [Herald DB]

Some suppliers have begun restocking Homeplus Express stores after Harim Group, which is acquiring the convenience supermarket chain, stepped in with a payment guarantee. However, only a fraction of suppliers have resumed deliveries so far, and full normalization is not expected until after June 22, when the business transfer is set to close.

Homeplus said in a statement Monday that sales at Homeplus Express have been recovering quickly since NS Shopping — a Harim Group affiliate — began guaranteeing supplier payments in June, enabling deliveries to resume. According to Homeplus, sales at Homeplus Express rose 16 percent from June 1 through June 11 compared with the period before deliveries restarted. Fresh food sales climbed more than 30 percent over the same period.

"Given that most key products began arriving on shelves from June 8 onward, we expect a full-scale sales recovery starting this week," Homeplus said.

Homeplus Express had struggled with delayed supplier payments as its parent company spent more than a year in court receivership. Many suppliers refused to make deliveries, leaving shelves empty or stocked only with Homeplus private-label products.

NS Shopping's decision to guarantee payments was made at the Harim Group level. Homeplus Express represents Harim Group's second attempt at running a supermarket chain, coming a decade after its first. Harim Group Chairman Kim Hong-guk has been strongly committed to restoring normal operations. Notices posted at Homeplus Express stores recently have read "June normalization notice" and "Products will be stocked in stages."

Not all suppliers have returned, however. About 120 companies have resumed deliveries so far, and full normalization is expected only after the acquisition is finalized. The deal is valued at approximately 120.6 billion won ($79.3 million). Due diligence is in its final stage, with the remaining balance due June 22. The Korea Fair Trade Commission approved NS Shopping's acquisition of Homeplus Express on June 12.

NS Shopping plans to keep Homeplus Express stores running without interruption after the ownership change. The company is also exploring ways to generate synergies, including linking the Homeplus Express quick-commerce unit to its home shopping business. About 70 percent of Homeplus Express's 293 stores nationwide operate quick-commerce services in the Greater Seoul area.

The ownership change at Homeplus Express is also drawing attention for its potential impact on supermarket chain industry rankings. Rival chains have seen sales rise in recent months as Homeplus shuttered locations. GS The Fresh, the top chain by store count, operated 589 stores nationwide as of the first quarter of this year, followed by Lotte Super with 331 and E-mart Everyday with 240.

Meanwhile, Homeplus said Monday that its remaining business units — including its hypermarket, online and headquarters operations, which are also on the market for mergers and acquisitions — could see customer traffic and sales recover quickly once product supply normalizes.


soho0902@heraldcorp.com