Homeplus Co., which is undergoing corporate rehabilitation proceedings, has again asked Meritz Financial Group to provide 200 billion won in emergency working capital needed to complete the rehabilitation.
Homeplus Co. issued a statement on the 12th saying, "A total of 200 billion won in working capital is needed for rehabilitation and a return to normal operations." This was in response to Meritz Financial Group saying the previous day it was willing to lend within 100 billion won, the additional joint-guarantee limit of MBK Partners.
Homeplus Co. says that with only 100 billion won in support, setbacks are unavoidable for the ongoing store closure efforts and normalization of product supply. If sufficient funds are not secured, the return to normal operations will be delayed and the chances of rehabilitation could also diminish, it said.
Conversely, if 200 billion won in emergency working capital is secured, the company expects to complete store efficiency measures and normalize the product supply system. The company says it could also positively affect restoring trust with partner firms.
Homeplus Co. stressed that the company, the labor union and the majority shareholder—key stakeholders—are each fulfilling their roles for rehabilitation. The company is pursuing the closure of 37 stores, and the union has accepted wage cuts and restructuring. The majority shareholder, MBK Partners, has also pledged an additional joint guarantee of 100 billion won.
The rehabilitation timetable is also tight. The deadline for the proceedings is July 3, and even if extended, they must be completed before Sept. 3. Homeplus Co. says securing 200 billion won in emergency working capital is the core task to achieve this.
Homeplus Co. said, "We once again earnestly ask Meritz Financial Group to make the decision to provide 200 billion won in emergency working capital so we can clear the final hurdle to rehabilitation."