Homeplus Co.'s labor and management called for active government support to prevent the company's bankruptcy. They said it would be hard to avoid bankruptcy if emergency operating funds are not secured by the court-set deadline and that 200 billion won in support is needed.
On the 24th, Homeplus Co., together with the Korean Confederation of Trade Unions (KCTU) Homeplus General Union, issued a joint statement asking the government and related agencies for support, saying, "Please prevent the company's bankruptcy."
Labor and management said, "Since entering rehabilitation proceedings on Mar. 4 last year, all executives and employees have endured hardship and made drastic self-rescue efforts such as downsizing stores and selling the supermarket division, but during the prolonged rehabilitation process, all operating funds have been exhausted, leaving us facing the worst cash crunch that makes it difficult to continue operations immediately."
They argued that the likelihood of bankruptcy would grow if emergency operating funds are not secured by the 30th, the deadline set by the court. As MBK Partners, the largest shareholder, has expressed its intention to provide a joint guarantee worth 100 billion won, they argued that Meritz Financial Group, the largest creditor, should also immediately step in with 200 billion won in emergency operating funds.
Labor and management said, "If Homeplus Co. goes bankrupt, as many as 100,000 direct and indirect employees will lose their jobs, and thousands of small partner firms and in-store vendors will lose their livelihoods and be driven out onto the streets."
Labor and management also called on Meritz Financial Group to assume social responsibility. They argued that, because it could recover the full principal and interest on its loans, as well as as much as 500 billion won in interest, by exercising collateral rights if Homeplus Co. goes bankrupt, it should support rehabilitation from the standpoint of inclusive finance rather than chasing only short-term gains.
They also appealed that if just 200 billion won from future revenue could be lent as operating funds, countless jobs and the basic livelihoods of ordinary people could be protected. At the same time, they emphasized that government-related agencies should actively communicate with the creditors to devise funding support measures.
Lee Jong-seong, Chairperson of the Korean Confederation of Trade Unions (KCTU) Homeplus General Union, said, "Homeplus Co. is not in a state where liabilities have eroded capital, and if time is secured through an extension of rehabilitation and assets are orderly disposed of, repayment of liabilities as well as rehabilitation are possible," adding, "Please prevent the bankruptcy of Homeplus Co., which concerns the livelihoods of 100,000 ordinary people."