Galeria Karstadt Kaufhof is one step closer to safety as its creditors have approved the rescue plan for the German department store chain. The chain suddenly sees a lot more opportunities to continue its operations under the leadership of its new (Belgian) CEO.
Major downsizing
Restructuring expert Arndt Geiwitz is relieved that his plan has been approved, but insists in a press release that it is “crucial that it is implemented quickly and consistently”.
The rescue plan has two main parts: most prominently, a major downsizing involving the closure of some fifty shops (out of 127). In addition, creditors would also have to agree to drop the vast majority of their outstanding claims – estimates hover around 98 %.
Instead, Galeria says in a press release that it will “focus on promising locations and meaningful spaces, a rapid conversion of all shops in three years, investment in digitisation and the IT process landscape, efficient and fast process flows, more shop-in-shop, complementary offers and, above all, more localisation”.
Belgian future
For Inno, the Belgian subsidiary of department store group Galeria, this new plan has no implications. It has been profitable on its own, and was not involved in these financial problems.
Another Belgian influence at Galeria is Olivier van den Bossche: he took the helm of the German retail group a few days ago and after this approval suddenly has a lot more leeway to plot a positive future for the company. “The first successes of the new concept are already visible in a number of pilot stores”, he sounds confident.
