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Russian consortium joins race for Karstadt

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Russian consortium joins race for Karstadt
Photo: DPA
14:30 CEST+02:00
A fourth bidder has joined the race for Germany's insolvent high-street department store chain Karstadt. A Russian consortium led by top businessman Artur Pachomov has shown interest.

Pachomov's consortium will be competing against the property developer Highstreet, as well the investment companies Triton and Berggruen.

According to news magazine Der Spiegel, Pachomov made an eight-figure bid for a 100 percent stake in Karstadt on Friday.

The Russian consortium offered to invest money into the company to capitalize on this year's Christmas market, and its official bid also promises "an annual investment of €80 million, beginning in 2011, to secure the long-term future of Karstadt."

According to the bid, the strategic aim of the investment is to internationalize the business and to expand Karstadt to attractive locations outside Germany. The consortium claims to have already lined up an appropriate building in St. Petersburg.

The consortium also says it numbers some former Karstadt managers among its advisors, including former board chairman Helmut Merkel.

Karstadt, which has 120 stores and around 25,000 employees in Germany, became insolvent in the summer of 2009 when its parent company, retail and tourism giant Arcandor, went bust. Arcandor has already sold off its mail order subsidiary Quelle.

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