Signa holds talks on sale of Chrysler Building
With debts of more than five billion euros, investor René Benko's Signa Holding has suffered the largest insolvency in Austria to date. The company has no choice but to part with prestigious properties. An exit from the Chrysler Building holdings is also a possibility.
Tyrolean investor René Benko's ailing Signa Holding has to part with important real estate holdings such as the Chrysler Building in New York as part of its insolvency proceedings. Shares in the newspapers "Kurier" and "Kronen Zeitung" are also being put up for sale. "A realization plan has been initiated for the accelerated sale of shareholdings and assets," announced restructuring administrator Christof Stapf at the creditors' meeting in Vienna.
In addition to the sale of Signa Holding's private jet, for example, there are also talks about the investment in Signa RFR US Selection AG, whose real estate projects include the prestigious Chrysler Building. Important Signa real estate companies such as Signa Development and Signa Prime are to be stabilized - as is Signa Retail, which also includes the Galeria Karstadt Kaufhof department store chain.
Stapf complained about Signa's complex structures - and in some cases a lack of internal controls. Stapf is trying to gain an overview of the widely ramified Signa empire and now also wants to examine transactions from the past. The consulting firm Deloitte is to support him in the investigation.
Stapf presents first interim report
With debts of over five billion euros, Benko's Signa Holding has filed for the largest insolvency in Austria to date and applied for debtor-in-possession restructuring proceedings on November 29. The commercial court in Vienna granted the application and appointed Stapf as insolvency administrator. In Germany, smaller Signa subsidiaries have also filed for insolvency. Insiders assume that further companies from Benko's widely ramified empire will follow.
Stapf has now presented his first interim report to the holding company's creditors' meeting. According to this report, 43 creditors have so far asserted claims amounting to around 1.13 billion euros. The holding company has a total of 273 creditors, including major banks and German savings banks as well as wealthy investors. Claims can be registered until January 15, 2024.
Stapf needs money to finance the complex proceedings - because the three million euros in subsidies promised by Benko are unlikely to be enough, he added. The continuation of the proceedings also requires "regaining control over individual parts of the Signa Group, insofar as this is still possible at all". Stapf therefore advocated the creation of a group-wide steering committee that would be responsible for the restructuring of the entire group.
Extremely complex structures
The holding company's insolvency application revealed that Benko's holding company had 53 direct holdings in companies and indirect holdings in several hundred other companies. Signa had created extremely complex structures: The preliminary organizational chart of the group as of the end of September comprised "a total of 46 pages in A3 format".
And that's not all: "The review has shown that there is a lack of management capacities with comprehensive knowledge in the middle management of the group and that the holding company has only partially fulfilled its control function recently." In addition, Signa transactions from the past would also have to be examined. Only then would it be possible to check whether the restructuring plan offered by Signa was appropriate. After all, the Signa representatives were "working closely with the restructuring administrator". The self-administration in the restructuring process could therefore remain in place. According to Austrian law, the creditors must receive a quota of at least 30 percent.
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Following the insolvency filing, discussions are underway regarding the potential investment in Signa RFR US Selection AG, a company with real estate projects including the renowned Chrysler Building in the USA, by Rene Benko's Signa Holding. Additionally, as part of the restructuring process, Stapf is considering establishing a group-wide steering committee to gain control over complex Signa Group structures, both in Austria and potentially Germany.
Source: www.ntv.de
