© Reuters. The emblem of Rene Benko’s actual property empire Signa is seen on the fence of a development web site in entrance of a division retailer of Galeria Kaufhof in Munich, Germany, January 9, 2024. REUTERS/Christine Uyanik/File photograph
VIENNA (Reuters) – It was a mistake for Austrian property group Signa to enterprise into the retail enterprise, since that value it capital that was sorely lacking when it tried to stave off insolvency, government Alfred Gusenbauer stated in feedback broadcast on Saturday.
Gusenbauer, a former chief of the Social Democrats and Austrian chancellor, was one of the vital senior executives within the complicated constellation of round 1,000 firms that make up Signa, the largest casualty to date of the woes afflicting Europe’s property sector.
Signa’s holding firm filed for insolvency in November with round 5 billion euros ($5.5 billion) in debt. Numerous items have since adopted go well with. Signa has high-profile initiatives and shops throughout Germany, Austria and Switzerland.
“I believe venturing into retail was a mistake,” Gusenbauer informed ORF radio in an interview. He’s supervisory board chairman of the heavyweight Signa Prime Choice and Signa Growth divisions and was on the just lately dissolved group advisory board of Signa Holding that included Signa’s founder Rene Benko.
He pointed to points such because the COVID-19 pandemic, the struggle in Ukraine, rampant inflation and the European Central Financial institution’s rate of interest will increase as having damage the property market and contributed to its money scarcity.
“The modifications out there setting led to an acceleration of a state of affairs that will have required extra capital. Sadly, that was not obtainable as Signa had launched into this retail journey, which value us greater than a billion euros,” Gusenbauer stated.
Signa’s German division retailer Galeria Karstadt Kaufhof filed for insolvency this week for the third time lately. Signa additionally just lately offered Austrian furnishings chain Kika/Leiner and its stake in division retailer chain Selfridges in Britain.
Additionally it is part-owner of Swiss division retailer chain Globus.
“You have not talked about the largest chapter in that context. That was Signa Sports activities United,” Gusenbauer added, referring to a web based sports activities retail enterprise which he stated had value Signa “roughly 800 million euros in money”.
($1 = 0.9133 euros)
