Two companies have entered the bidding race for Korean retail giant Homeplus in an effort to secure new ownership and stabilise operations.

According to investment banking sources, AI firm Harex InfoTech and one undisclosed bidder submitted letters of intent (LOIs) by the October 31 deadline.

Homelplus – which was bought by MBK Partners from Tesco in 2015 – succumbed to bankruptcy after years of declining sales and liquidity pressures, reportedly struggling to cover basic expenses such as electricity bills.

In March, it received court approval to seek a buyer under its rehabilitation program.

Harex InfoTech is reportedly preparing to raise approximately US$2 billion in the US to finance its bid. Under the proposed sale plan, all common shares held by MBK Partners would be cancelled, and new shares would be issued to the successful bidder.

The winning bidder must take on Homeplus’ debts, including $940 million owed to Meritz Financial Group and $405.8 million in preferred shares held by the National Pension Service (NPS).

Due diligence for qualified bidders will now continue until November 21, with final bids due on the 26th.

Although the current deadline for submitting Homeplus’ rehabilitation plan is November 10, industry watchers expect the court to extend it to accommodate the bidding schedule.