One day before ultimatum deadline, Homeplus submits amended rehabilitation plan

'1.2 trillion won in cost cuts… operating profit in the 80 billion won range once normalized'

Court expected to grant one-to-two month extension as deadline looms

A Homeplus store in Jamsil, Songpa-gu, Seoul, slated for closure [Herald DB]
A Homeplus store in Jamsil, Songpa-gu, Seoul, slated for closure [Herald DB]

Homeplus, which is undergoing corporate rehabilitation proceedings, submitted an amended rehabilitation plan to the Seoul Rehabilitation Court on Monday — one day before the court's ultimatum deadline. The filing is expected to buy the retailer up to two additional months while the court reviews the revised proposal.

Homeplus announced the submission in a press release Monday, saying it had filed "an amended version of the revised rehabilitation plan" with the Seoul Rehabilitation Court. The updated plan reflects the sale of its Homeplus Express supermarket division, the closure of 37 stores, and workforce reductions through natural attrition and voluntary redundancy programs.

"As a result, various costs have been reduced by approximately 1.2 trillion won ($777 million) compared to just before the rehabilitation filing," Homeplus said, adding that its 67 core hypermarket locations could achieve operating profit in the 80 billion won range as soon as supply and operations return to normal. The company projected that figure would grow to 150 billion won within three years. It also said it plans to repay both public-interest claims and rehabilitation claims in full, using profits from the return to profitability and proceeds from the sale of real estate at closed stores.

Homeplus also reaffirmed its intent to pursue a merger and acquisition of its remaining business units, including the hypermarket and online operations and its headquarters. The company said the separation and sale of the supermarket division had significantly reduced the burden on potential acquirers, and expressed confidence that the improved business fundamentals would attract buyers seeking to enter the domestic retail industry while minimizing new-entry risk.

The amended filing is widely seen as a strategic move to extend the court's deadline. Legal sources said it is unlikely the rehabilitation court will complete its review of the amended plan before the current approval deadline of Friday. That expectation underpins forecasts that the court will extend the deadline at least once before beginning its review — with some projections pointing to an extension of one to two months.

Earlier, the court had ordered Homeplus to secure and submit a plan to raise 200 billion won in external financing by 5 p.m. Tuesday. The court also solicited opinions from creditors, shareholders, labor unions and other stakeholders on whether to terminate the rehabilitation proceedings under the Debtor Rehabilitation and Bankruptcy Act. Under Article 286, Paragraph 1, Subparagraph 1 of the act, rehabilitation proceedings may be terminated before a plan is approved if the debtor fails to submit a plan within the court-set period, or if the submitted plan is deemed unfit to be brought before a creditors' meeting for deliberation or a vote.

If the court grants an extension, Homeplus is expected to attempt to raise funds independently — potentially through the sale of remaining business units — or to resume efforts to persuade Meritz Financial Group, its largest creditor. If the financing problem remains unresolved, however, the company would again face the prospect of bankruptcy, returning to square one.

Meritz had previously approved a loan of only 100 billion won — half of the 200 billion won in debtor-in-possession financing Homeplus had requested — and attached a condition requiring a personal guarantee from Kim Byung-ju, chairman of MBK Partners, Homeplus's majority shareholder, before any disbursement. The dispute has deepened mutual recriminations among Homeplus, MBK and Meritz, with each party blaming the others.

Online, many consumers have expressed sadness over Homeplus's plight. With numerous stores closing this year, shoppers have lamented the growing difficulty of finding "Bomeokdwae" — barley-fed pork, one of Homeplus's signature products — and items from Simplus, the retailer's private-label brand. Posts on one online community read: "It's sad that I can't find Bomeokdwae anymore" and "Simplus products I used to buy all the time have completely disappeared."

Whether politicians will again weigh in is also drawing attention, amid concerns that a Homeplus bankruptcy could trigger mass unemployment and the collapse of local commercial districts. Adding to the pressure, a hunger strike by the Mart Workers' Union — Homeplus's main labor union — has stretched to nearly 50 days.

In political circles, there are expectations that the Democratic Party of Korea will push for additional hearings on MBK after the National Assembly completes its second-half leadership formation. The Homeplus situation is also expected to feature prominently in the upcoming national audit. MBK chairman Kim appeared as a witness before the National Assembly's Political Affairs Committee national audit in October 2025 in connection with the Homeplus crisis.


soho0902@heraldcorp.com