Arcandor goes bust
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AFP
June 9, 2009
Retail and tourism giant Arcandor said on Tuesday it had filed for bankruptcy, putting around 43,000 jobs at risk in Germany after Berlin dismissed its request for emergency state aid.
“Arcandor AG today filed with the Essen District Court to open insolvency proceedings due to threatening illiquidity,” the statement said.
Travel agency Thomas Cook, in which Arcandor holds a 52-percent stake, “will remain unaffected by the insolvency proceedings,” the statement added.
The group, which employs 70,000 people in Europe, two-thirds of whom work in Germany, said its department store chain Karstadt, as well as mail-order company Quelle, would also be affected by the insolvency.
On Monday, Berlin rejected the company’s request for €650 million ($902 million) in state loan guarantees and €437 million in emergency loans but gave the firm one last chance to submit an improved bid.
But following an emergency meeting, the firm’s board said it could no longer raise funds after the government rejected its plea for help.
“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,” the group said. “As a result the company had no further prospects for sustainable financing.”
Text size
AFP
June 9, 2009
Retail and tourism giant Arcandor said on Tuesday it had filed for bankruptcy, putting around 43,000 jobs at risk in Germany after Berlin dismissed its request for emergency state aid.
“Arcandor AG today filed with the Essen District Court to open insolvency proceedings due to threatening illiquidity,” the statement said.
Travel agency Thomas Cook, in which Arcandor holds a 52-percent stake, “will remain unaffected by the insolvency proceedings,” the statement added.
The group, which employs 70,000 people in Europe, two-thirds of whom work in Germany, said its department store chain Karstadt, as well as mail-order company Quelle, would also be affected by the insolvency.
On Monday, Berlin rejected the company’s request for €650 million ($902 million) in state loan guarantees and €437 million in emergency loans but gave the firm one last chance to submit an improved bid.
But following an emergency meeting, the firm’s board said it could no longer raise funds after the government rejected its plea for help.
“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,” the group said. “As a result the company had no further prospects for sustainable financing.”
