Your browser is no longer supported. For the best experience of this website, please upgrade to a newer version or another browser.

Your browser appears to have cookies disabled. For the best experience of this website, please enable cookies in your browser

We'll assume we have your consent to use cookies, for example so you won't need to log in each time you visit our site.
Learn more

Sale talk at Karstadt

The future of German department store business Karstadt looks uncertain after parent company Arcandor said it was considering selling off some of its assets.

Arcandor announced last month that it was thinking of cutting its stake in Karstadt and in its tour operator business Thomas Cook, following a refinancing deal.

However, Arcandor has ditched plans to sell its majority stake in Thomas Cook after selling new shares to German bank Sal Oppenheim and increasing Arcandor’s capital.

This leaves its stake in Karstadt as its only remaining disposable asset. Speculation has increased that Arcandor is preparing to split up its Karstadt business, possibly by selling off divisions such as Karstadt Sports or its food, business or travel agency.

There is also speculation that an investor may pick up Karstadt and department store chain Galeria Kaufhof, which has been put up for sale by Germany’s biggest retailer Metro, and merge the two businesses.

Arcandor is understood to have had talks with UK department store chain Debenhams about a possible merger, but has so far been unable to find a suitable partner.

Arcandor had net financial liabilities of €1.5 billion (£1.16bn) at the end of June and is under pressure from banks to sell parts of the business.
Karstadt reported an EBITDA loss of €51 million (£39.5m) for the third quarter of the year.

It said that the department store’s business had been hit by low consumer confidence and inflation concerns. The company said it planned to increase margins to an acceptable level on the back of vigorous cost cutting.

Separately, high-end German fashion chain SinnLeffers has said it plans to cut about 1,000 jobs and half the size of its 47-store chain, as part of a restructuring intended to improve profitability.

The business, which has approximately 2,300 staff, has been hit by high rents and a drop in consumer spending and filed for insolvency in August.
SinnLeffers was sold off by Karstadt Quelle, now Arcandor, as part of a restructuring at the company three years ago.

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions. Links may be included in your comments but HTML is not permitted.