Distressed discount retailer Homeplus to shutter 37 stores
A person riding a bike looks at a closure notice posted on the entrance of a Homeplus store in southern Seoul, May 10. Yonhap
Financially troubled discount chain Homeplus is shuttering more than 30 percent of its stores across the country, a decision likely to leave some 3,500 employees jobless, industry sources said Thursday.
The company delivered the decision in a notice to its labor union earlier in the day, saying it will permanently close operations of 37 stores among 104 operated by the company.
Operations at the 37 stores had been suspended since last month, after the retailer sold its supermarket business, Homeplus Express, to NS Shopping, a local home shopping channel operator.
Around 3,500 employees are said to be hired at the stores, while around 1,500 hold managerial positions will likely be subject to voluntary retirement, insiders added.
Private equity firm MBK Partners acquired a 100 percent stake in Homeplus in 2015 from British retailer Tesco Plc for 7.2 trillion won ($4.9 billion).
The retailer, however, became financially strapped due to a slump in the discount store industry and eventually entered court-led rehabilitation proceedings in March last year.