Key facts
- A Seoul court terminated rehabilitation proceedings for the retailer Homeplus.
- The court rejected Homeplus' revised plan because it failed to secure 200 billion won.
- The South Korean government will offer financial support to Homeplus employees and partner companies.
- Support for employees includes compensation for unpaid wages and low-interest loans.
- Around 440 billion won in liquidity support will be provided to small merchants and businesses.
- The government will hold weekly task force meetings to address the Homeplus issue.
A Seoul court has terminated the rehabilitation proceedings for the troubled discount store chain Homeplus, rejecting its revised business reorganization plan due to its failure to secure the required 200 billion won (US$130 million).
Following the court's decision, the South Korean government announced efforts to support Homeplus employees and its partner companies. The Ministry of Finance and Economy stated that financial support measures would be implemented, including compensation for unpaid wages, low-interest loans, and liquidity support for small merchants and businesses that rely on Homeplus.
Employees could receive up to 21 million won to cover unpaid wages, with low-interest loans of up to 10 million won available at a 1.5 percent rate. Approximately 440 billion won in liquidity support will be offered to small businesses that partner with Homeplus. Businesses wishing to close can also receive support for closure costs and legal consultations.
The government plans to hold weekly task force meetings to monitor the situation, assess damage to workers and partners, and examine the potential impact of store closures on regional economies. Measures to fundamentally strengthen the country's retail industry will also be considered.