German retail group Arcandor has filed for bankruptcy protection after yesterday’s decision by the German government not to provide rescue funds. An administrator is expected to be appointed today.
Arcandor‘s retail businesses Karstadt Warenhaus, Primondo and Quelle have also applied for protection from creditors.
Travel business Thomas Cook, Primondo’s speciality mail order companies and home shopping channel HSE24 are unaffected by the insolvency proceedings.
The retailer said: “The insolvency application became necessary after Arcandor AG’s requests for state loan guarantees and rescue aid were rejected and further requirements couldn’t be fulfilled.
“As a result the company had no further prospects for sustainable financing. Given the fact that loans in the amount of €710m (£611.9m) will shortly become due, the company will be threatened with insolvency as of June 12, 2009.”
Supplier receivables for new goods deliveries will be dealt with within the framework of the agreed payments terms as of today, Arcandor said, and all customer orders in mail order will be fulfilled.
Dr Karl-Gerhard Eick, chairman of Arcandor’s management board, said: “We will continue to fight to save as many jobs and locations as possible and to offer a good future for our traditional, valuable German brands.”