Homeplus Resumes Operations at 67 Stores Amid Restructuring Efforts

Homeplus is set to resume operations as it secures 200 billion won in emergency operating funds (DIP). The Seoul court has canceled its decision to terminate the rehabilitation process, allowing the company to reopen 67 temporarily closed hypermarkets nationwide while simultaneously restructuring its business.

In a statement on July 22, Homeplus announced, "The Seoul Rehabilitation Court has decided to extend the rehabilitation process until September 4, allowing us to focus on normalizing operations and innovating our structure."

The company plans to reopen the 67 stores that have been closed since July 13 as soon as the DIP funds are received. Initially, it will prioritize the sale of food and essential goods, which have high sales volumes and turnover rates, to quickly improve cash flow.

The online segment will begin operations with 16 stores in the metropolitan area, gradually expanding delivery services through discussions with logistics partners.

Homeplus will also change its store operations. Some locations that were previously multi-level will be converted to single-level stores, approximately 1,000 square meters in size, focusing on food, private label products, and high-turnover essentials.

A Homeplus representative stated, "This business model is similar to that of Trader Joe's, a leading U.S. retailer, and is a strategic response necessary for Homeplus's recovery and normalization amid competition with e-commerce companies." Trader Joe's supermarkets feature over 80% of their products as private label items.

The DIP funds are expected to be primarily used for essential operating costs, including payments for goods, overdue rent, and utility expenses such as electricity and water. The company also plans to pay overdue employee wages and settle outstanding payments to small business partners. However, Homeplus has informed employees that the payment of retirement benefits, originally scheduled for today, will be postponed due to a lack of funds.

Previously, on July 20, Homeplus management held an emergency meeting to discuss plans for reopening stores following the court's decision to appeal the termination of the rehabilitation process. Although the initial inventory levels will be only about half of what they were during normal operations, including fresh and processed foods and essential goods, the company remains committed to resuming operations.

Meanwhile, the court has extended the deadline for Homeplus's rehabilitation plan approval until September 4. Considering that Homeplus entered the rehabilitation process on March 4 of last year, this extension is effectively the last opportunity for the company.