The Democratic Party of Korea met Thursday with executives from MBK Partners, Homeplus's largest shareholder, and Meritz, its biggest creditor, telling them that "about 100 billion won ($66.2 million) in emergency operating funds is needed to put out the immediate fire" surrounding the Homeplus crisis. The party also met with Kim Seong-ju, chairman of the National Pension Service, urging him to take a public stance to pressure MBK.
Min Byeong-deok, a lawmaker and chairman of the Democratic Party's Euljiro Committee, said at the National Assembly meeting that a rehabilitation court had ruled July 3 to terminate Homeplus's rehabilitation proceedings. "All the vulnerable parties connected to Homeplus are now standing at the edge of a cliff," Min said. "If no solution is found before the appeal deadline on July 22, the livelihoods of 100,000 people will collapse — suppliers, tenant businesses, more than 13,000 workers and their families, and the local commercial districts that have built their lives around Homeplus."
Min said farms that had supplied Homeplus were owed 1.9 trillion won in unpaid payments. "An enormous number of sales outlets are about to disappear," he said. "Farmers are deeply worried, and those concerns are being conveyed to us."
"What we need is not an ultimate solution but emergency operating funds to put out the fire right now — about 100 billion won," Min said. "It is by no means a small amount, but considering the profits MBK and Meritz have made through Homeplus and the social trust they stand to lose, I do not think it is beyond what they can bear."
He added that he was "respectfully requesting that the executives of Meritz and MBK fulfill the social responsibilities they must bear as creditors and investors."
Kim Gwang-il, vice chairman of MBK Partners, said the company "sincerely apologizes to all those who have been enduring hardship because of Homeplus."
Kim Jung-hyun, chief executive of Meritz Fire & Marine Insurance, said he hoped "practical solutions will emerge from today's meeting" and pledged that his company would "do its best."
Cho Ju-yeon, chief executive of Homeplus, said the company was "truly sorry for the great difficulties we have caused so many people during the long rehabilitation process." She urged the Euljiro Committee not to forget the more than 10,000 Homeplus employees and partner company workers. "Please continue to support them," she said.
The Euljiro Committee later held a separate meeting with National Pension Service Chairman Kim Seong-ju. Min told Kim that "a clear statement from the National Pension Service at this urgent moment, when emergency operating funds are desperately needed, would put significant pressure on MBK — and I am sure the chairman knows that." Min also noted that under the criteria governing the selection and management of fund managers entrusted with national pension assets, a manager that receives an institutional warning or heavier sanctions from financial regulators can have its mandate revoked or restricted.
Min said the national pension fund has committed about 2.5 trillion won to 11 private equity funds managed by MBK, and that while some of the money has been recovered, a substantial amount remains under management. "Given that the National Pension Service manages the retirement savings of the Korean people, there is a need to more strictly oversee the appropriateness and accountability of its entrusted fund managers," he said.
sunpine@heraldcorp.com
