Purmil to End Business Next Month Due to Deficit... All Employees to Be Laid Off

[Asia Economy Reporter Eunmo Koo] Dairy specialist company Purmil will cease operations next month. This marks 15 years since its spin-off from Lotte Group in 2007.

According to industry sources on the 17th, Purmil recently sent an email to all employees notifying them of the business closure and layoffs. The layoffs will affect all Purmil executives and staff, effective November 30.

In the email, Purmil stated, "Due to over four years of declining sales and accumulated losses caused by the COVID-19 pandemic, we have tried internal self-help measures including pledging company assets as collateral, but have faced a situation with no visible results, forcing us to terminate the business." Purmil added that although layoff notices must be given at least 50 days in advance, the layoffs were decided under unavoidable circumstances according to Article 24, Paragraph 3 of the Labor Standards Act.

Purmil, originally established as Lotte Milk in 1978, changed its name after spinning off from Lotte Group in 2007. Since CEO Donghwan Shin took office in 2018, the company has struggled with deficits. Operating losses started at 1.5 billion KRW in 2018, then expanded to 8.8 billion KRW in 2019, 11.3 billion KRW in 2020, and 12.3 billion KRW in 2021.

After Shin Junho, brother of the late Lotte Group founder Shin Kyuk-ho, stepped down from co-CEO position last year, his second son Donghwan Shin took sole charge of management aiming to revitalize the company, but efforts fell short. Earlier this year, a sale to LG Household & Health Care was pursued but ultimately failed.

This content was produced with the assistance of AI translation services.