Homeplus, one of South Korea’s largest supermarket chains, is embarking on a sweeping restructuring effort as it battles a severe liquidity crunch and a dramatic decline in sales. The company announced on May 8, 2026, that it will temporarily suspend operations at 37 out of its 104 large supermarket stores nationwide from May 10 to July 3, focusing its limited resources on 67 core locations. This move, which affects more than a third of its outlets, comes after a year in which many stores saw sales plummet by over 50% compared to the previous year, largely due to persistent product shortages and the tightening of supply conditions by major partners.
According to Hankyung and Yonhap Infomax, Homeplus’s decision is a direct response to the mounting challenges faced since the start of rehabilitation proceedings. With suppliers demanding stricter terms and reducing deliveries, the retailer has struggled to keep shelves stocked, resulting in widespread customer loss and a sharp drop in revenue. "We are prioritizing the limited supply of goods to our core stores to recover customer choice and prevent further sales decline and customer leakage," a Homeplus representative explained to Yonhap Infomax.
The suspension is not a blanket closure; it applies strictly to the large supermarket division. Tenants and small businesses operating within the affected stores—such as clothing shops and eyewear retailers—will continue their business as usual. Employees at the 37 suspended stores are being offered a suspension allowance equivalent to 70% of their average wages, with the option to transfer to other operating stores if they wish to continue working. This measure, the company says, aims to cushion the blow for staff during the two-month hiatus.
The impact of these changes is being felt across the country. In Incheon, for example, five stores—Sungui, Gajwa, Yeonsu, Nonhyeon, and Songdo—will close their doors, alongside the neighboring Bucheon Sosa location. This follows the earlier closure of Incheon Gyesan store in January, signaling a deepening crisis in key metropolitan areas. The Seoul Bankruptcy Court has already extended the deadline for Homeplus’s rehabilitation plan approval from May 4 to July 3, reflecting the urgency and complexity of the company’s restructuring process.
Homeplus’s troubles are not limited to declining sales. The company recently completed the sale of its Homeplus Express (supermarket business) to NS Shopping, an affiliate of Harim Group, securing around 1.2 trillion KRW in cash. Yet, as reported by Opinion News and Chosun, this sum falls short of what is needed to fully fund the company’s recovery and maintain smooth operations until the proceeds are fully received—a process expected to take about two months. The proceeds from the Express sale will be used to pay off some debts, but Homeplus still faces a significant funding gap as it seeks to stabilize its remaining business units.
In response, Homeplus has approached its largest creditor, Meritz Financial Group, with requests for both a short-term bridge loan and debtor-in-possession (DIP) financing to secure the liquidity necessary to keep the business afloat during the transition. Meritz, which holds about 4 trillion KRW in collateral—including 68 Homeplus stores—has yet to provide a concrete response. Without Meritz’s cooperation, Homeplus executives warn, the company’s ability to obtain additional funding is severely limited. "Most of the funds we’ve managed to secure through asset sales since the start of the rehabilitation process have gone directly to repaying Meritz loans, leaving us unable to secure even minimal operating capital," a Homeplus spokesperson told ZDNet Korea.
The company’s revised rehabilitation plan, which is being prepared to address creditor demands, includes measures to improve store efficiency, suspend underperforming outlets, and pursue mergers and acquisitions (M&A) for the remaining business units. Homeplus intends to submit this strengthened plan to the court soon and is already considering M&A options alongside the Express sale. The goal, as outlined in statements to Incheon Today and Opinion News, is to enhance the business viability of the large supermarket, online, and headquarters divisions, sell them to third parties, repay outstanding debts, and ultimately complete the restructuring process.
The labor situation is tense. The labor union has expressed concern over the suddenness of the announcement and the uncertainty facing employees. "There’s a difference between a closure or suspension based on a recovery plan and simply shutting down stores because business is tough," said Lee Dong-ik, secretary of the Mart Industry Union’s Incheon and Bucheon branch, as quoted by Incheon Today. "The longer this drags on, the more stores will close and the worse things will get. The government needs to step in quickly. Appointing a third-party manager through KAMCO is urgent." The union has even indicated a willingness to make wage concessions to support the company’s rehabilitation, arguing that resources should be redirected to ensure product supply and operational stability.
Industry experts echo the union’s concerns, noting that Homeplus’s survival hinges on its ability to secure fresh liquidity and restore normal operations. "It’s difficult to guarantee recovery through asset sales alone," one industry source told Opinion News. "The chances of revival will increase only if additional liquidity is secured and business normalization happens simultaneously." Homeplus itself has warned that a failure to supply funds in a timely manner could result in "large-scale employment instability, damage to suppliers, and contraction of local markets—expanding the social costs," as cited in Hankyung.
Meanwhile, the company is pressing its largest creditor to consider the broader implications. "We hope Meritz will make a forward-looking decision as an inclusive financial institution, taking into account social responsibility and the value of coexistence," a Homeplus official stated, emphasizing the critical role that creditor support will play in the company’s fate.
Homeplus’s struggle is a stark illustration of the challenges facing traditional retailers in a rapidly changing market. With mounting debts, tightening supplier terms, and consumer habits shifting ever more online, the company’s ability to adapt—and the willingness of creditors and policymakers to intervene—will determine whether this storied retailer can weather the storm or becomes another casualty of retail’s ongoing transformation.