MBK Partners Seeks Buyer to Prevent Liquidation of Korean Retail Chain Homeplus

MBK Partners is seeking to sell its South Korean supermarket chain Homeplus to avoid the retailer's liquidation following a court-led restructuring initiated in March due to pandemic pressures and intense e-commerce competition. A recent valuation revealed Homeplus's liquidation value exceeds its going-concern value, prompting MBK to plan a sale involving issuing new shares to a buyer while cancelling its existing stake worth approximately 2.5 trillion won ($1.8 billion). MBK originally acquired Homeplus from Tesco in 2015 for about £4 billion, but the chain has since struggled to adapt to changing consumer behavior, losing significant value. Concurrently, South Korean prosecutors are investigating whether MBK approved a debt issuance despite a prior credit downgrade, resulting in a travel ban on MBK's chairman, Kim Byung-ju. This situation highlights broader challenges in private equity and traditional retail sectors facing digital disruption and increased regulatory scrutiny in Asia. The sale is seen as critical for stabilizing Homeplus and potentially soothing South Korea’s shaken credit markets.