Homeplus wins time, not turnaround

The Seoul Bankruptcy Court has resumed corporate rehabilitation proceedings for Homeplus, after the retail chain secured 200 billion won ($130 million) in debtor-in-possession (DIP) loans from financial institutions affiliated with Meritz.

The decision came as a huge relief for Homeplus employees, as well as workers in related services such as cleaning and security, and thousands of small and medium-sized suppliers.

Yet the resumption of rehabilitation proceedings does not guarantee that the hypermarket chain — once the nation's second-largest retailer at its peak — will successfully graduate from court supervision and return to normal business operations.

Although the company has managed to secure the funding needed to restart the rehabilitation process, its path to recovery remains steep, if not bleak.

The court's decision came weeks after it had ordered the termination of the rehabilitation process on July 3.

That decision reflected Homeplus' rapidly deteriorating financial condition.

Its debts had continued to mount while sales revenue kept falling during the year since the com ...