Jun Ji-hye, a reporter at the finance desk of The Korea Times, focuses primarily on economic policy and government agencies, mainly covering the Ministry of Finance and Economy, the Ministry of Budget and Planning, the National Tax Service and the Korea Customs Service. She previously covered financial authorities, including the Financial Services Commission and the Financial Supervisory Service, and earlier worked on the political, city and business desks, reporting on a wide range of issues.
Court approves Homeplus restructuring plan
A staff member arranges products on a shelf at a Homeplus store in Seoul, Wednesday. Yonhap
By Jun Ji-hye
Homeplus, which is under court-led rehabilitation proceedings, secured court approval Wednesday for its restructuring plan.
The rehabilitation proceedings of the country's No. 2 supermarket chain will come to an end once it begins repaying creditors in line with the approved plan.
The Seoul Bankruptcy Court held a creditors’ meeting earlier in the day to vote on the plan. After creditors approved the proposal, the court immediately gave it the green light, formally authorizing the retailer to carry out the debt repayment and restructuring measures set out in the plan.
“The plan satisfied the requirements for approval, with support from at least two-thirds of creditors,” the court said.
It urged the retailer, controlled by private equity firm MBK Partners, to cooperate closely with its employees and business partners and do its utmost to ensure the successful implementation of the rehabilitation plan.
MBK Vice Chairman and Homeplus co-CEO Kim Kwang-il, who attended the meeting, apologized to creditors affected by the company’s rehabilitation process.
“Our priority under the restructuring plan is to restore profitability by focusing our business on profitable stores,” he said. “We also plan to sell certain stores promptly and use the proceeds to prioritize repayments to creditors.”
The court plans to close the rehabilitation proceedings once the retailer begins making repayments in full under the approved plan.
Failure to follow the schedule, however, could lead the court to terminate the rehabilitation proceedings despite the plan having been approved. The court would then have the authority to declare the retailer bankrupt without a separate application.
Homeplus has been under court-led rehabilitation proceedings since March 4 last year.
The firm’s rehabilitation proceedings were initially terminated on July 3 after it failed to raise 200 billion won ($147 million) in minimum operating funds. The process was later reinstated after its largest creditor, Meritz Financial Group, stepped in with the necessary financing.
Since then, Homeplus has resumed normal operations at 67 stores as of Aug. 13, about a month after they were temporarily closed as the company struggled to pay suppliers and landlords amid a shortage of operating funds.