MBK "Homeplus Asset Securitization Includes 15 Stores, 10 Stores to Be Renewed"

MBK Partners announced on the 19th that since acquiring Homeplus in October 2015, a total of 15 stores have undergone asset securitization, and that 10 of these stores will be renewed with a new concept after redevelopment of the aging buildings and will re-enter the market.

MBK stated, "There are inaccuracies regarding MBK Partners' current and past invested companies in the press reference materials distributed by Korea Zinc, and we would like to correct these."

MBK added, "In the materials, Homeplus, referred to as 'A Mart,' is said to have sold multiple stores to repay acquisition financing, but this is not true."

An MBK representative said, "Asset securitization and store closures are managerial choices made to establish a foundation for sustainable growth amid the rapidly changing offline retail business environment. Unlike other competitors, Homeplus chooses to redevelop and re-enter stores whenever possible, except in cases of chronically unprofitable stores or when leaseholders refuse contract renewal, making every effort to maintain the number of stores and employee employment," adding, "The asset securitization through store closure and re-entry is conducted in accordance with procedures agreed upon with the labor union, and employee employment is also guaranteed. The proceeds from asset securitization are used not only for improving financial structure but also for operational activities including investments."

Furthermore, "Homeplus guarantees 100% employment of store employees even during the asset securitization process and provides employment stability support funds to help employees adapt to new workplaces," emphasizing, "Homeplus has been fully committed to employment stability, including converting 14,283 contract workers to full-time employees in 2019, and hires over 1,000 people annually on a large scale."

Additionally, "While other competitors are conducting artificial restructuring such as large-scale voluntary retirements in the first half of this year to improve performance, Homeplus has never conducted any artificial workforce reductions," and "The reduction in Homeplus's workforce size is due to voluntary resignations and retirements, similar to other offline retailers, and is unrelated to restructuring. Homeplus has a lower turnover rate compared to major mart competitors," the statement said.

Regarding C Chicken (bhc Chicken), which Korea Zinc cited in the National Assembly audit remarks, MBK said, "This is an ongoing investment, and MBK Partners has never received dividends from bhc Chicken. The claim by Korea Zinc that most profits are sent overseas is groundless."

Earlier, bhc Chicken raised chicken prices twice, in December 2021 and December 2023. MBK Partners argued that this was a managerial decision made reluctantly due to worsening franchisees' profits caused by delivery app commission issues.

An MBK representative explained, "bhc Chicken was fined twice by the Fair Trade Commission in 2021 and 2023, but both cases stemmed from disputes with the same franchisee. These incidents occurred before MBK Partners' Special Situations invested financially in bhc Chicken's holding company," adding, "The dispute with the franchisee was due to the previous management's reckless management style. In 2023, bhc's board dismissed the existing management and appointed a new CEO."

MBK stated that regarding the ING Life investment, net income at the time of recovery in 2019 grew by about 40% compared to the investment point in 2014, and the RBC ratio, a financial soundness indicator, improved from 291% to 425%.

An MBK representative said, "The voluntary retirement in 2014 was a policy promoted before MBK Partners' acquisition. At that time, the life insurance industry was struggling so much it was called the 'year of death.' The industry-wide voluntary retirement scale reached about 2,000 people," adding, "ING Life had about 158 voluntary retirees, including executives from ING Group headquarters, and the treatment of retirees was at the industry's highest level."

The MBK representative also said, "There is no reason to sell assets or conduct restructuring that damages corporate value to increase operating returns through share sales," and "From a mid- to long-term investment perspective, after acquiring the target company, we introduce a professional management system, establish various strategies, and execute investments through management. Operating profits of invested companies are achieved not simply by cost reduction but mostly through sales growth."

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