Austrian real estate group Signa, owned by businessman René Benko, announced on Friday it will take full control of the ailing German department store Karstadt from US-German investor Nicolas Berggruen.
"At the beginning of next week, Signa Retail will acquire the whole of Karstadt Warenhaus GmbH from Berggruen Holdings," the group said in a statement. "In addition, Berggruen Holdings will withdraw completely from Karstadt Premium and its luxury flagship stores KaDeWe in Berlin, Oberpollinger in Munich and Alsterhaus in Hamburg."
Similarly, Berggruen would offload his stake in Karstadt Sports, the statement added.
Signa had already acquired 75.1-percent stakes in Karstadt Premium and Karstadt Sports in 2010 for €300 million.
The €1 price was a symbolic price tag as the Austrian group said it would not pay any additional purchase price for the outstanding 24.9-percent stakes or the 100-percent stake in the group's
core department stores.
Karstadt employs more 17,000 people in its 83 stores. Under Berggruen's stewardship, more than 2,000 employees have been laid off. Stefanie Nutzenberger, a director at German trade union ver.di said that those remaining have high hopes for their new boss.
"The employees have been bitterly disappointed by the alleged social investor Berggruen," she said in a statement on Friday.
The deal has to be approved by the relevant anti-trust authorities, Signa said.
Berggruen took over Karstadt in 2010 when the tourism and retail group Arcandor went bust. At the time, Berggruen also paid only €1 for the chain. Recently, new CEO Eva-Lotta Sjöstedt, who was expected to be the chain's saviour, left her position after only five months on the job.
Signa's real estate holdings are estimated to be valued at more than €4 billion.