Karstadt rescue deal likely to sacrifice 4,000 jobs

Karstadt rescue deal likely to sacrifice 4,000 jobs
Photo: DPA
An investor negotiating to takeover the bankrupt Karstadt department store chain is talking of making 4,000 staff cuts and reducing rental payments at store sites, media reports said on Sunday.

German-Swedish investor Triton has linked its offer of €30 million to buy the chain to a number of conditions, the Bild am Sonntag reported on Sunday.

It said 4,000 of the 26,000 staff would have to go, and the rental fees on the properties would have to be reduced before the chain could be bought – and then €60 million invested in it.

“We want to develop, not pull apart,” a spokesman for Triton told the paper. He said the investment firm believed in the potential of Karstadt, but emphasised that the company would have to make compromises to enable the sale.

He said Triton had submitted a strategic concept and did not want to keep anything secret.

But the Frankfurter Allgemeine Zeitung on Sunday said that there is pressure for a rapid agreement, with Klaus Hubert Görg, spokesman for the bankruptcy administrators, saying they wanted a deal by the end of the month.

The most important creditors are considering the Triton suggestions, he said. But should an agreement not be reached by the end of the month, Görg said consideration would be given to a consortium called Highstreet, involving investment bank Goldman Sachs. It already owns around two-thirds of the 120 Karstadt department store properties, but could bid to take over the operating business, the FAZ said.

Görg has already said that Highstreet would be willing to reduce rents by €150 million to aid any potential rescue deal, while employees and others involved in running Karstadt have also said they would take hits to save the company.

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