Galeria Karstadt Kaufhof has filed for bankruptcy. A leading German supermarket chain is actively looking for a new owner due to the financial instability of Signa, which previously promised a €200 million supply, but this commitment is now uncertain.
While it is operational, this is the third insolvency proceeding for Galeria, which employs around 15,000 staff. The retailer was previously forced to declare bankruptcy in 2020 due to the Covid-19 pandemic, and then in 2022 due to increased inflation and energy costs due to the conflict in Ukraine.
Signa Holding, which includes about 1,000 companies with various businesses in Germany, Austria and Switzerland – including an ownership stake in the Chrysler Building in New York – filed for bankruptcy late last year with debts of about 5 billion euros. Subsequently, other departments within Cigna became insolvent as well.
Despite Galeria's efforts since 2020 — which included store closures and downsizing — Signa's difficulties have been too great, threatening the company's existence. For this reason, Galleria has begun negotiations with potential investors, seeking a change of ownership in order to overcome the current difficult times.
Source: Reuters
Cover image credit: Sean Gallup/Getty Images
