Homeplus Co., which is undergoing corporate rehabilitation proceedings, submitted a revised rehabilitation plan to the court. The Seoul Bankruptcy Court said that after the panel and an examiner review it, if the feasibility of the revised plan is recognized, it will be put to a vote at a meeting of interested parties, and if not, the court is expected to decide to exclude the plan and terminate the rehabilitation proceedings.
On the 30th, the Seoul Bankruptcy Court said, "The revised rehabilitation plan for Homeplus Co. was submitted at 6:58 p.m. today." The court said, "After review by the panel and the examiner, if feasibility is recognized, the revised rehabilitation plan will be put to a vote at a meeting of interested parties, and if feasibility is not recognized, it is expected that a decision will be made to exclude the rehabilitation plan and terminate the rehabilitation proceedings."
The court also said it may extend the deadline for approval of the rehabilitation plan to review the revised plan. The current approval deadline for the Homeplus Co. rehabilitation plan is July 3. The statutory deadline is Sept. 4, and if the panel decides additional review is needed, the deadline can be extended further.
Homeplus Co. is said to have prepared an amendment to its existing revised rehabilitation plan that reflects improved business viability from its own self-help efforts. The amendment is said to state that since the start of the rehabilitation proceedings, the number of stores has decreased from 126 to 67, staffing has been cut by about half, and various expenses have fallen by 1.2 trillion won compared with just before the filing for rehabilitation. It is also said to include projections that, if product supply normalizes, operating profit could reach the 80 billion won range, and could grow to 150 billion won within three years.
The submission of the revised plan is seen as a response to the court, which raised doubts about the feasibility of the existing rehabilitation plan. Earlier, the court noted that no realistic plan had been presented for the 200 billion won in additional financing included in the existing rehabilitation plan, and it asked that opinions on excluding the plan and terminating the rehabilitation proceedings be submitted by today.
The key issue remains the additional 200 billion won in financing. The amendment Homeplus Co. is said to have prepared includes expense reductions and improved revenue prospects, but reportedly does not include a plan to secure additional funds. The panel and the examiner are expected to make a comprehensive review of financing feasibility, expense-cutting effects, and prospects for normalizing operations to decide whether to put the matter to a meeting of interested parties.
Homeplus Co. employees and labor unions say the approval deadline for the rehabilitation plan needs to be extended. The two main Homeplus Co. unions reportedly emphasized the need to maintain the rehabilitation proceedings, noting that if the corporations are liquidated, the livelihoods of more than 100,000 people, including partner firms, could be put at risk.
Uncertainty over the additional financing has not been resolved. Meritz Financial Group is said to have capped its support at 100 billion won and set it on the condition of a guarantee from MBK Chairman Kim Byung-ju. MBK is reportedly saying it is difficult to accept that. If the court finds the plan to secure an additional 200 billion won insufficient, it cannot rule out the possibility of excluding the rehabilitation plan or terminating the rehabilitation proceedings.
Earlier, as of 5:30 p.m. the same day, the Seoul Bankruptcy Court said that the revised rehabilitation plan for Homeplus Co. had not been submitted. At the time, the court said that since the approval deadline for the rehabilitation plan had been extended to July 3, the revised plan should already have been submitted. After Homeplus Co. submitted the revised plan at 6:58 p.m., the process moved to the stage of feasibility review by the panel and the examiner.