MBK Hearing on 'Homeplus Eat-and-Run' Stalled for 5 Months... Ruling Party Says "Absolutely Necessary"

Although Ruling and Opposition Parties Agreed on a Hearing in March, Progress Remains Slow
Kim Namgeun: "People Power Party Refuses to Convene a Hearing"
Concerns Over Split Sale if Bulk Sale Fails in September

Homeplus, which is currently undergoing rehabilitation procedures, is facing difficulties in finding a new owner, and there is a growing demand in the National Assembly to hold a hearing targeting the existing major shareholder, MBK Partners, which has been at the center of a "eat-and-run" controversy. The Democratic Party of Korea stated, "Solving the problem begins with MBK admitting its mistakes," and emphasized, "It is absolutely necessary to hold a hearing."

On June 16, at the National Assembly Communication Hall in Yeouido, Seoul, Shin Jangsik, a member of the Jo Guk Innovation Party, is speaking at a press conference held by the parties urging the resolution of the Homeplus incident and the adoption of a resolution to hold a National Assembly hearing. Photo by Yonhap News

Min Byungdeok, chairman of the Democratic Party's Euljiro Committee, said at the forum "MBK's True Intentions: Is Homeplus Being Revived or Abandoned?" held at the National Assembly Members' Office Building on the morning of the 1st, "Since a merger and acquisition (M&A) is being pursued before the rehabilitation plan is approved, the key is to determine which company will survive." However, he stressed, "For me, the most important thing is resolving the issues faced by Homeplus-related workers, tenant companies, suppliers and their employees, and victims of Jeondanchae."

Chairman Min further stated, "What both the ruling and opposition parties are interested in is not the M&A itself, but the normalization of the lives of those related to Homeplus," and added, "A hearing is essential to clarify the conditions for this." He continued, "If this issue is not resolved, regardless of whether it is an M&A or any other form, everything will be considered a 'eat-and-run' case," emphasizing, "The purpose of this forum is to prevent such an outcome."

Kim Namgeun, a Democratic Party lawmaker who attended the forum, said, "The opposition has not agreed to convene a hearing, arguing that the Financial Supervisory Service's investigation into the MBK·Homeplus issue is not yet complete and that an investigation is still ongoing." He added, "We must hold a hearing to confirm these conditions, and even if we cannot hold a hearing, we will verify them through other means."

Representative Kim explained, "There are questions as to whether the National Pension Service properly exercised its oversight when MBK used a leveraged buyout (LBO)?acquiring a company with loans and repaying them using the company's assets and profits?to acquire a company, damage it, and then enter rehabilitation procedures." He added, "We will definitely ask the National Pension Service why they allowed the Homeplus situation to occur and whether they properly fulfilled their stewardship code responsibilities."

Previously, on March 18, both the ruling and opposition parties agreed at the full session of the National Assembly's Political Affairs Committee to hold a hearing targeting MBK. At the time, Kang Min-guk, the People Power Party's secretary on the committee, said, "Public anger toward Kim Byungjoo, the MBK chairman, who is a so-called 'black-haired foreigner,' seems to be sky-high," and added, "We should continue to hold hearings until he appears before the National Assembly, and if that is not enough, we should also conduct a parliamentary investigation."

Members of the Homeplus Branch of the Mart Industry Union, affiliated with the National Service Industry Labor Union Federation, held an expanded executive resolution rally in front of D Tower, where MBK's office is located, in Jongno-gu, Seoul, on April 14, shouting slogans demanding "MBK responsible for Homeplus corporate rehabilitation." Photo by Yonhap News

However, since then, MBK has been pushing for the sale of Homeplus through a pre-approval M&A structure, and as no agreement has been reached between the ruling and opposition parties, the hearing has been repeatedly postponed. MBK is giving up its entire stake worth 2.5 trillion won and is seeking a buyer. The estimated sale price of Homeplus, according to industry sources, is around 3.7 trillion won based on liquidation value, but considering the collateralized loans on its real estate holdings, the actual sale price is expected to be in the 1 trillion won range.

Currently, companies such as Coupang, Emart, Nonghyup, and Chinese e-commerce firms are being mentioned as potential buyers, but due to the structural downturn in the offline retail industry, the sale is proving to be difficult. Baek Juseon, managing partner at Daeyul Law Firm, who gave a presentation at the forum, predicted, "The end of September is the deadline, and if a bulk sale is not possible, solutions such as a split sale or government intervention will likely be sought."

Kim Byungguk, chairman of the Homeplus Tenant Emergency Response Council, said, "The National Assembly hearing has stalled as the administration has changed," and requested, "Please hold a hearing on MBK, which continues to act irresponsibly, as soon as possible." Ahn Suyong, head of the Homeplus branch of the Mart Industry Union, emphasized, "The media is reporting that a primary investor will be found by September, but if we reach September, the only options will be a split sale or liquidation. We cannot delay any longer. If the M&A does not proceed properly, the government must step in."