The department store group Galeria Karstadt Kaufhof, who has been facing financial troubles, announced the closure of 16 out of its 92 stores on August 31 this year. This decision was made by insolvency administrator Stefan Denkhaus on Saturday following the group’s bankruptcy filing at the beginning of January. This marks the third bankruptcy in three and a half years for the company, with Van den Bossche citing the bankruptcies under the previous owner René Benko’s Signa Group as contributing factors to their current difficult situation.
Among the 16 stores set to close, three are particularly hard hit by the closures. This move will affect about 12,800 employees, with 11,400 expected to keep their jobs while 1,400 will unfortunately have to be let go. Galeria has reached a reconciliation of interests and a social plan with the general works council to manage this transition.
Despite the challenges, Galeria’s Chef Olivier Van den Bossche expressed optimism about leading the business to a successful future, citing positive sales development in the current financial year. The company’s headquarters are also planned to move from Essen to the Düsseldorf Schadowstrasse branch as part of their restructuring efforts.
Although a consortium led by the US investment company NRDC and entrepreneur Bernd Beetz has expressed interest in taking over the department store chain, the agreement is contingent upon creditor approval. Insolvency administrator Denkhaus aims to present an insolvency plan for the change of ownership by the end of April, with final approval expected to be obtained from the creditors’ meeting on May 28 and then confirmed by the court. The handover to the new owners is projected to take place by the end of July.