This article was published on Nov. 3, 2025, at 4:51 p.m. on the ChosunBiz MoneyMove site.
Public funds backed by Homeplus Co. properties have repeatedly received adverse opinions from auditors. Liquidity problems have arisen, such as being unable to pay loan interest due to rent adjustments with Homeplus Co. To minimize principal losses for investors, a successful merger and acquisition (M&A) before approval of Homeplus Co.'s rehabilitation plan is necessary, but that is uncertain as only bidders with questionable acquisition capacity have entered the race.
On Nov. 3, investment banking industry sources said IGIS Asset Management's "IGIS Core Retail Real Estate Investment Trust No. 126," which holds Homeplus Co.'s Jeonju Hyoja store, received a qualified opinion from its external auditor. The fund had briefly breathed a sigh of relief after narrowly extending the maturity of its borrowing fund in midyear, but uncertainty grew after receiving the qualified opinion this time.
The fund had previously received a disclaimer of opinion in April. At the time, IGIS Asset Management said the following: During the audit of the fund, a material event occurred when Homeplus Co., which was the tenant responsible for the entire asset, had a court decision to commence corporate rehabilitation proceedings, and the auditor requested a fair value assessment. However, due to uncertainty over the impact of the rehabilitation proceedings on the valuation of the asset, it was unable to provide revised financial statements reflecting a fair value assessment.
When the fund bought Homeplus Co.'s Jeonju Hyoja store in 2017, it raised 66.7 billion won through a public offering and 107.5 billion won through senior and subordinated loans. The fund's returns once reached 60%, but they are now about 13%. To realize those returns, the Jeonju Hyoja store must be sold, so at present the possibility of principal loss cannot be ruled out.
A real estate fund managed by Yukyung PSG Asset Management, backed by three stores — Homeplus Co.'s Ulsan, Gumi Gwangpyeong and Siwha branches — also received its third disclaimer of opinion. The funds to acquire the Homeplus Co. stores for that fund totaled 300.2 billion won, of which 107.3 billion won was raised via public offering.
KB Pyeongchon Retail REIT, which holds Homeplus Co.'s Pyeongchon store, failed to extend the maturity on its borrowing fund and has defaulted on principal and interest. Homeplus Co.'s Pyeongchon store was folded into the REIT during a lease deposit securitization process in 2019 after private equity firm MBK Partners acquired Homeplus Co. in 2015. The acquisition price at the time was 103 billion won and the public offering amount was 31.7 billion won.
Uncertainty continues as public funds that bought Homeplus Co. properties have repeatedly received disclaimers of opinion in audits, increasing the likelihood of investment losses. The only realistic way to reduce principal losses is for Homeplus Co. to succeed in a sale, but voices say the likelihood of that happening is still low. That is because the companies that submitted letters of intent (LOIs) this time have weak financing capabilities.
An industry official said Harex InfoTech, an artificial intelligence Fintech company, and Snowmad, a real estate leasing and development firm, joined the Homeplus Co. takeover bid on Oct. 31. As of year-end, Harex InfoTech recorded 300 million won in sales and an operating loss of 3.3 billion won. Snowmad posted 11.6 billion won in sales and 2.5 billion won in operating profit, but recorded a net loss of 7.3 billion won. With Homeplus Co.'s liquidation value at 3.7 trillion won, these companies are judged to be insufficient to acquire it.
An industry source said the companies participating in the Homeplus Co. bid are unlikely to complete the takeover. If a well-capitalized bidder does not emerge to consummate the deal, the principal losses of public funds that even lowered rents are likely to be unavoidable.