The submission period for the investigation report of Homeplus, which is undergoing corporate rehabilitation proceedings, is expected to be extended. The investigation report is the basis for the rehabilitation plan. If the liquidation value of Homeplus is greater than the going-concern value in the investigation report, the possibility of a transition to bankruptcy proceedings increases. Therefore, it is analyzed that Homeplus requested to postpone the submission period to negotiate rent with store landlords.
According to investment banks (IB) and the legal sector on the 21st, Homeplus filed an application to the court for an extension of the investigation report submission period the day before. The court plans to decide on the approval by the deadline for the submission of the investigation report, which is the 22nd.
The investigation report contains a comprehensive analysis of the financial situation and business plans of the target corporation. The core of the investigation report is the 'going-concern value,' which is the economic value created when corporate activities continue, and the 'liquidation value,' which is the value obtained when ceasing corporate activities and liquidating assets. Typically, when the going-concern value is higher than the liquidation value, the corporate rehabilitation process is maintained, and when the liquidation value is higher, the procedure transitions to bankruptcy, where Homeplus's assets are liquidated and distributed to creditors.
The application for an extension of the investigation report submission period by Homeplus appears to be an effort to increase the going-concern value. Homeplus spends about 400 billion won annually on rent and aims to reduce operating expenses through rent adjustment negotiations with landlords. Recently, Homeplus notified 17 landlords of contract termination while negotiating rent adjustments with landlords of 61 operating stores.
If the submission period for the investigation report is extended, the submission date for the rehabilitation plan, scheduled for the 12th of next month, is also likely to be postponed. The rehabilitation plan will include scenarios for restructuring, such as asset sales, and a repayment plan accordingly. A meeting of interested parties will then be held to decide the approval through voting by secured creditors and rehabilitation creditors. The deadline for approval of the rehabilitation plan under the Debtor Rehabilitation Act is March 4, 2026.