Anna Jiwon Park has been covering the politics at The Korea Times since the summer of 2024, when she joined the press pool for the Office of the President in Korea. Prior to that, she spent about five years reporting extensively on financial markets, regulatory authorities and the financial industry. She joined The Korea Times in 2019 after spending eight years as a broadcast journalist at Arirang TV, Korea’s leading global broadcaster, covering politics, defense and culture.
MBK Partners to sell Homeplus Express
A promotional image for Homeplus Express / Courtesy of Homeplus
By Anna J. Park
MBK Partners has initiated the process of selling Homeplus Express, the neighborhood supermarket business division of Homeplus.
As the supermarket store platform boasts the industry's second-largest online instant delivery network, following Baemin's B Mart, as well as over 400 offline stores nationwide, market watchers' attention is now focused on who will take over the mega-retailer's supermarket store division.
According to the investment banking industry on Monday, the North Asia-focused private equity firm and Homeplus recently appointed Morgan Stanley as the lead manager for the sale and have begun the process of selling Homeplus Express.
The selling side is planning to distribute an investment memorandum to around 10 potential buyers, including domestic and global retail companies, e-commerce and online platforms, as early as the end of this month.
Launched in 2004, Homeplus Express is a so-called SSM, short for "Super Supermarket," referring to a smaller supermarket run by large enterprises. Homeplus Express has maintained a market share of over 20 percent, alongside GS The Fresh, Emart Everyday and Lotte Super, each making up the "big four" in the industry.
Although Homplus does not officially disclose the earnings made by its neighborhood store business division alone, industry insiders estimate that last year's revenue for the Homeplus Express division stood at approximately 1.2 trillion won ($871 million).
The division's EBITDA margin rate — earnings before interest, taxes, depreciation and amortization — was also at around the 8 percent range, demonstrating higher profitability compared to the SSM industry's average EBITDA margin of around 5 percent.
In the retail industry, Homeplus Express is recognized for having the largest number of directly operated stores in the Seoul metropolitan area, including Seoul, Incheon and Gyeonggi Province, compared to its competitors.
Based on the strength of accessibility within the Seoul metropolitan area, Homeplus Express's online delivery service has posted an average annual sales growth rate of around 84 percent over the past two years.
Industry watchers anticipate that this deal would inject new energy into M&A opportunities in the domestic distribution sector, as it presents a unique chance to acquire a platform with a nationwide network of both offline stores and online fresh food delivery capabilities.
"It is expected that various distribution companies will show interest in acquiring the company from a strategic perspective, given its unique omnichannel status in the domestic distribution market with strong offline and online capabilities," an investment banking industry source said.