Another restructuring expert takes over important Signa position
The ailing real estate and retail group Signa has brought the experienced restructuring expert Erhard Grossnigg on board as manager of the most important sub-companies. The Austrian has been appointed as an additional member of the management boards of Signa Prime Selection AG and Signa Development Selection AG. This was announced by the Signa Group, founded by billionaire René Benko, in Vienna. Grossnigg will "implement the next reorganization and restructuring steps for the two real estate companies", it said. Previously, the German reorganizer Arndt Geiwitz had been appointed to the advisory board of the Signa Group at the beginning of November.
Signa Holding AG filed for insolvency last Wednesday. However, the most important properties and construction projects in the Signa portfolio belong to Signa Prime - including the Elbtower construction project in Hamburg, which is currently at a standstill, the KaDeWe department store in Berlin and department store properties of the Galeria Karstadt Kaufhof chain.
The group did not comment on the possible insolvency of Signa Prime and Signa Development. "The quality of the Signa Prime portfolio is outstanding, the development prospects of the development projects, which are located in the top locations of German-speaking cities, are very good," said the Austrian former chancellor Alfred Gusenbauer, who serves as chairman of the supervisory board of both companies.
Loss in the three-digit million range
Signa Prime posted a loss of around one billion euros in the previous year and had around 10.8 billion euros in debt at the end of 2022. Signa Development posted a loss of 316 million euros.
In the low-interest phase of recent years, Benko was able to take out cheap loans and attract financially strong investors to significantly expand his group. The recent rise in interest rates, construction costs and energy prices have put his complex network of companies in a precarious position.
- Erhard Grossnigg, the appointed restructuring expert, will oversee the implementation of reorganization steps for both Signa Prime Selection AG and Signa Development Selection AG in their real estate ventures, including the Elbtower construction project in Hamburg and the KaDeWe department store in Berlin.
- Despite signa Holding AG filing for insolvency, Signa Prime Selection AG continues to showcase an outstanding portfolio in quality and promising development prospects for its projects situated in top German-speaking city locations.
- The German reorganizer Arndt Geiwitz joined Signa Group's advisory board early in November, aiming to contribute expertise in real estate and retail trade as well as insolvency management following the group's recent financial hardships.
- The retail trade sub-company, Signa Development Selection AG, has faced its fair share of challenges, reporting a loss of 316 million euros in the previous year, considerably smaller compared to Signa Prime Selection AG's loss of around one billion euros during the same period.
Source: www.dpa.com
