KaDeWe Group

History

2024: Bankruptcy Declaration

On January 29, 2024, the German company KaDeWe Group, which owns the well-known trading houses Kaufhaus des Westens (KaDeWe) in Berlin, Oberpollinger in Munich and Alterhaus in Hamburg, filed for bankruptcy. The most famous department store in Germany, founded 117 years ago, faced serious financial difficulties.

KaDeWe Group said in a statement that the company is forced to declare its own insolvency due to too high rents, which it is no longer able to afford. KaDeWe Group's parent entity is Signa Retail Selection, which went bankrupt in November 2023. Signa's lenders are reluctant to cut rents for fear of reducing the cost of securing its liabilities. KaDeWe Group is majority owned by Thailand's Central Group, which bought a 50.1% stake from Signa in 2015.

Unsplash

KaDeWe Group CEO Michael Peterseim emphasizes that trading houses are performing well as of early 2024, but high rents are hurting their profitability. According to him, "numerous negotiations with the landlord did not change the situation, as did the bankruptcy of Signa itself."

That means the business is profitable in itself, but turns out to be unprofitable after rent costs, KaDeWe Group said in a statement.

Central Group plans to buy out the remaining stake in department store trading business Signa, as well as KaDeWe property in Berlin. A report from the Thai conglomerate noted that the group was unable to reach an agreement to lease stores due to KaDeWe's "irreconcilable landlord position." At the same time, Central Group expects to find a common language with Signa on the acquisition of assets.^[1]

Notes