The Homeplus negotiating union, the Homeplus branch of the Mart Industry Labor Union, stated that Homeplus's credit rating downgrade means it must "stop store sales and prepare sustainable revenue structural improvement measures."
According to the related industry on the 4th, the Homeplus labor union claimed in a statement on the 1st that "temporary fundraising through store sales is not a fundamental solution to the corporation's underlying issues (operating losses, changes in consumer trends)."
It explained, "As a result of relying on short-term asset sales without responding to the structural changes in the large mart industry (increased online consumption, expansion of nearby and small purchases), the corporations' future competitiveness is further weakened."
Along with this, the union demanded ▲ stop store sales ▲ establish worker-centered sustainable management strategies ▲ intervention from the government and regulatory authorities.
The union said that "there is a need for a strategy that simultaneously achieves employment stability for workers and sales recovery" and "intervention is necessary to prevent private equity fund MBK from making short-term profits and to ensure the long-term survival of corporations."
MBK formed a consortium with the Canada Pension Plan Investment Board (CPPIB), Public Sector Pension Investment Board (PSP Investments), and Temasek in 2015 and acquired Homeplus for 7.2 trillion won.
On the 28th of last month, Korea Ratings and others downgraded Homeplus's credit rating from "A3" to "A3-". The grounds are ▲ prolonged poor business performance ▲ ongoing heavy financial burdens ▲ limited prospects for business performance and financial structure improvement in the mid to short term.
Homeplus said on the morning of that day that "the credit rating announced on the 28th of last month did not adequately reflect many improvements such as increases in online and offline sales and improvements in liability ratios, leading to a downgrade," and applied to the Seoul Bankruptcy Court for the initiation of corporate rehabilitation procedures.
As of January 31st, Homeplus's liability ratio and sales for the previous 12 months were 462% and 7.0462 trillion won, respectively. This represents an improvement in the liability ratio of 1506% compared to a year ago, and sales increased by 2.8%.