Homeplus Faces Bankruptcy as Court Rejects Restructuring Plan

Homeplus, which has been under corporate restructuring for over a year, is effectively entering bankruptcy proceedings. This raises concerns about potential job losses for at least 13,000 employees, both direct and indirect.

On July 3, the Seoul Bankruptcy Court's Restructuring Division decided to terminate the restructuring process for Homeplus. The court deemed the likelihood of executing the revised restructuring plan submitted on June 30 as low.

The court indicated that a minimum of 200 billion won (approximately $150 million) would be necessary to implement the restructuring plan, but Homeplus has been unable to secure these funds. Although the court could have extended the deadline for approving the restructuring plan until September under the Debtor Rehabilitation Act, it interpreted that further extensions would likely be ineffective.

Homeplus has the option to file an immediate appeal within 14 days of the decision. If it can secure funding and file the appeal within this timeframe, there remains a possibility that the court could reverse its decision. However, if no appeal is filed or if it is rejected, the termination of the restructuring process will be finalized.

For companies whose restructuring processes are terminated, the only option left is to proceed with bankruptcy. While it is possible to reapply for restructuring, the likelihood of approval is considered low without significant changes in circumstances.

Homeplus initially filed for restructuring on March 4, 2025, and the court approved the process on the same day. Subsequently, Homeplus submitted a structural innovation-based restructuring plan on December 29, 2025. On June 30, it presented a revised plan that included the closure of unprofitable stores and the sale of business units, but it failed to meet the court's requirements.

The termination of the restructuring process is expected to have significant repercussions for employment and suppliers. As of late last month, Homeplus employed approximately 12,000 staff. Considering indirect employment, including parking and cart management, as well as cleaning staff, the total job impact could be substantial.

Suppliers and investors may also face significant losses. Small and medium-sized enterprises and small business owners supplying to Homeplus are owed an average of 770 million won (approximately $580,000) each in unpaid delivery fees.

Particularly, general trade claims are classified as subordinate, and Homeplus's cash assets were only 10.4 billion won (around $7.8 million) as of late February, making it difficult for creditors to recover their funds. Additionally, victims of the company's commercial paper are expected to struggle to recover approximately 401.9 billion won (about $300 million) in losses.

Meanwhile, Homeplus did not issue a separate statement regarding the court's decision on this day.