It is unusual for the Tyrolean real estate investor René Benko to announce a sale instead of an acquisition.
A fund managed by Apollo Global will acquire 17 Galeria Karstadt Kaufhof stores for 700 million euros from René Benko’s Signa Group. That was reported by the financial news agency Bloomberg on Thursday afternoon according to “people familiar with the proceedings”.
According to this information, the fund has prevailed over at least two further bidders and already applied for approval from antitrust authorities.
Which 17 of the total of 240 locations are concerned, has not yet been reported. It is no secret that the retail giant Galeria Karstadt Kaufhof, with more than 28,000 employees, recently applied for insolvency protection proceedings due to the impact of the corona crisis. These proceedings protect the company, which is currently in an urgent restructuring phase, from its German creditors. Otherwise, the company would have already been forced to initiate insolvency proceedings. These protection proceedings enable the company terminate leasing agreements more quickly. Allegedly, Benko has announced that he intends to keep the company alive and is willing to provide further capital. These additional funds may well come from this current deal.
In the recent past, Benko regularly made the headlines with his spectacular acquisitions–ranging from the Austrian furniture store chain Kika Leiner to the Swiss department store chain Globus. He achieved his goal with Kaufhof-Karstadt in September 2018, when the merger of the two ailing department store chains was announced. According to insiders quoted by Bloomberg, Signa’s strategy for Kaufhof-Karstadt focuses on seven particularly lucrative inner-city locations in Germany, especially in Berlin, Munich, or Düsseldorf. Otherwise, it is said, that assets would be reduced.