Financial Authorities Launch On-Site Investigation of MBK... Probing Unfair Transactions in 'Homeplus Situation'

Refocusing After March
Reflecting the Intentions of the New FSS Governor

Financial authorities have conducted an on-site investigation of MBK Partners in connection with the Homeplus situation. This move is interpreted as reflecting the intentions of the newly appointed Governor of the Financial Supervisory Service.

According to industry sources on August 27, the Financial Supervisory Service and the Financial Services Commission dispatched a large team of investigators to the headquarters of MBK Partners in Gwanghwamun, Seoul, on the morning of the same day to begin an on-site inspection. This comes five months after the last inspection in March.

The authorities are reportedly seeking to determine whether there were any unfair transactions related to the Homeplus situation. They are expected to scrutinize the entire acquisition process, including how MBK gathered fund investors (limited partners) and used a leveraged buyout (LBO) method to acquire Homeplus.

During the inspection in March, the focus was on allegations of unfair transactions, specifically whether MBK Partners' management issued short-term bonds while concealing preparations for Homeplus's corporate rehabilitation procedure.

Recently, as MBK announced plans to close 15 Homeplus stores during its asset liquidation process, it appears that financial authorities have become aware of the criticism from political circles and labor groups.

Previously, on August 14, the "Homeplus Situation Resolution Joint Countermeasures Committee" held a press conference urging the immediate halt of the closure of the 15 stores and called for self-rescue efforts to normalize the company.

Members of the National Policy Committee of the Democratic Party of Korea in the National Assembly also called for a parliamentary hearing to determine MBK's responsibility regarding the decision to close some Homeplus stores.

This investigation is said to have been initiated in particular by Lee Chanjin, the new Governor of the Financial Supervisory Service. Last year, when he served as the Policy Advisory Committee Chair at the People's Solidarity for Participatory Democracy, he strongly criticized the National Pension Service's investment in MBK, calling it "an act of breach of trust against the public."

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