Homeplus Suspends Hypermarket Operations Starting Today Due to Depleted Funds

Homeplus is temporarily suspending its hypermarket operations starting today, July 13, due to a depletion of operating funds and an inability to cover store maintenance costs.

For businesses located in malls attached to the hypermarkets, operations may continue depending on the decisions of the individual tenants.

This temporary suspension measure applies not only to the hypermarket stores but also to the company's headquarters organization.

In a press release, Homeplus explained, "With all operating funds exhausted, we are unable to pay for merchandise or cover essential utility costs to maintain the stores. We can no longer operate the stores normally," adding that the decision was made "for the purpose of security and safety maintenance."

As the company announced the closure only this morning, some employees arrived at their stores at opening time, only to be notified of the temporary suspension and sent home.

Homeplus stated that it would monitor the situation and the court's final decision until July 20, the deadline for an immediate appeal against the termination of the rehabilitation process, before deciding whether to resume operations.

In a letter sent to employees, the Homeplus management team said, "The company will not give up until the very end and will continue to seek ways to pursue rehabilitation," adding, "Although the company currently has no way to resolve this situation on its own, we will do our best to find a solution based on the support and cooperation of numerous stakeholders."

The management also offered an apology, stating, "We express our deepest gratitude and apologies to all our employees."

Tenants operating in malls connected to Homeplus stores, such as Olive Young and Daiso, appear likely to continue their operations for now.

Olive Young, which operates around 20 stores, stated, "We plan to review whether to close stores in line with the expiration dates of each individual contract." Daiso said, "We will continue operations for now and decide (on potential closures) based on the situation, including the court's decision after July 20."

Daiso currently operates around 40 directly managed stores within Homeplus malls.

Previously, the Seoul Bankruptcy Court decided to terminate the rehabilitation process for Homeplus.

This was because a plan to raise 200 billion won, the minimum amount of capital required to implement the rehabilitation plan, had not been secured.

However, if a plan to secure operating funds is submitted by the appeal deadline, the decision to terminate the rehabilitation process could be reconsidered.

Since its rehabilitation process began in March of last year, Homeplus has been undergoing restructuring, including reducing the number of its hypermarket stores from 126 to 67 and selling off its supermarket division, Express. However, the company remains on the verge of bankruptcy as it has failed to secure the operating funds necessary for its rehabilitation plan.

(Photo: Yonhap News)
※ Please note: This article was translated by AI and may contain errors.