Homeplus Faces Critical Week Ahead of Restructuring Vote

Homeplus is approaching a critical week as the deadline for approving its restructuring plan nears. The creditors' meeting scheduled for September 2 is expected to be a turning point in determining the company's future. Stakeholders, including creditors and shareholders, will decide whether to support the restructuring plan submitted by Homeplus, marking what is seen as a final hurdle for the company's recovery.

According to the retail industry on August 27, Homeplus is seeking approval from public creditors for a debt repayment plan ahead of the September 4 deadline. The level of agreement among public creditors is a key indicator of the plan's feasibility. Online and in-person signatures were collected until the previous day, while paper submissions (fax and email) are expected to be accepted until August 28. The union reports that unpaid amounts owed to 1,267 suppliers total approximately 503 billion won. As of the afternoon of the same day, the approval rate for the public creditor repayment plan is reported to be in the 40% range.

Suppliers that continue to provide products to Homeplus are reportedly agreeing to the repayment plan, considering the potential for business normalization. In contrast, companies that have ceased transactions and are left with outstanding receivables are less inclined to agree.

Homeplus anticipates that a low approval rate among public creditors could lead the court to assess the feasibility of the restructuring plan negatively. An increased burden of immediate debt repayment could hinder the company's ability to secure necessary funds for future operations. If the restructuring plan is not approved, the recovery process is likely to end, leading to bankruptcy proceedings.

Homeplus's public creditors include not only unpaid supplier payments but also overdue wages and severance pay, totaling around 930 billion won. Since wage claims also fall under public creditors, Homeplus is seeking consent from both current and former employees regarding delayed severance and wage payments. The employee approval rate has reportedly exceeded 75%.

Efforts to normalize operations are ongoing to enhance the chances of recovery. Homeplus has launched its third large-scale discount event starting today. From August 28 to 30, all products from Han-don Ilpum Pork will be offered at discounts of up to 50%. These promotions aim to attract customers back to stores and demonstrate to the court, creditors, and potential buyers that Homeplus's competitive edge remains intact.

If the restructuring plan is approved at the creditors' meeting, Homeplus is expected to accelerate its merger and acquisition (M&A) process. The union believes that securing a new buyer could expedite the repayment timeline for deferred public creditor debts. A union representative stated, "We will thoroughly monitor the process to ensure that no unfair harm comes to our partners during normalization. If a solid new business entity steps in as the acquirer, management will quickly get back on track."