Homeplus Aims to Resume Operations After Securing Emergency Funding

Homeplus has confirmed that it aims to resume operations by August 1 after securing 200 billion won (approximately $150 million) in emergency operating funds. The company is expediting product orders and store layout adjustments to reopen its 67 stores nationwide.

According to industry sources on July 22, Homeplus management held an emergency meeting on July 20, the same day they filed an immediate appeal against the Seoul Bankruptcy Court's decision to terminate its rehabilitation process. Previously, on July 13, Homeplus temporarily suspended operations at all 67 of its large stores due to a depletion of operating funds.

Initially, Homeplus plans to focus on high-demand food and essential goods. The initial inventory for fresh produce, processed foods, and essential items will be only about half of what it would be during normal operations, but the company remains committed to resuming business.

Homeplus intends to optimize store efficiency by converting its two-story stores into single-story layouts, focusing on food, private label (PB) products, and essential goods. A company representative stated, "This business model is similar to that of Trader Joe's, a leading U.S. retailer, where over 80% of the products sold are private label, and the stores are optimized for food and essential goods sales."

The day before the court's decision to terminate the rehabilitation process, Homeplus further detailed its plans for normalizing operations, setting the reopening target for August 1. However, adjustments to this date may occur depending on when the emergency funding is executed, potentially shifting the reopening to July 30 or August 3.

In the online sector, Homeplus plans to start operations immediately at 16 stores in the metropolitan area and gradually expand its delivery range in coordination with delivery companies. An industry insider noted, "Homeplus is likely to operate its stores initially with a focus on core products like fresh food and essentials, and the specific product order volume will be determined once the store layout plans are finalized."

The company is also addressing unpaid wages and severance payments. Homeplus plans to pay 60% of the unpaid June salaries to employees on this day and settle severance pay for June. Previously, the company had paid 40% of June salaries on July 13.

A Homeplus representative stated, "We will complete the structural reform work within the given timeframe and begin the sale process in earnest. We also plan to close the remaining 37 underperforming stores during the remaining rehabilitation period." The representative added that they will minimize headquarters and store personnel to reduce costs, and those not working will remain on leave for the time being.

Meanwhile, the court has extended the deadline for Homeplus to finalize its rehabilitation plan until September 4. Considering that the company entered the rehabilitation process on March 4 of last year, this is effectively the last extension.