Galeria Karstadt Kaufhof, Germany’s largest department store chain owned by Austrian Sign Group, has initiated its third insolvency procedure in less than four years over financial issues.
The chain has a network of 92 stores and more than 15,000 employees. The retailer owned by Signal Retail Selection has ongoing sale negotiations with potential investors, according to euronews.com. At the same time, the current owner would provide financial support to the tune of €200 million for restructuring efforts.
According to Olivier van den Bossche, CEO of Galeria Karstadt Kaufhof, “the insolvencies of the Signa Group are damaging Galeria massively, hindering ongoing business and seriously limiting future development possibilities as a result of high rents and expensive services.”
In late 2023, Signa Group, which is founded by Rene Benko, said in a statement that it could not secure enough liquidity for an out-of-court restructuring and had to file for insolvency.
Galeria Karstadt Kaufhof’s financial troubles deepened in 2020 during the pandemic lockdowns, when it first filed for insolvency and received state aid. Two years later, the company was hit by the high energy prices and inflation and had to once again secure protection from creditors. Last year, the retailer closed dozens of stores as part of a restructuring plan.
Sign up today for the latest news