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18. 01. 12. - 16:00

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18. 01. 12. - 16:00

Metro scuppers Signa expansion for now

Signa Holding (Signa) has been forced to say goodbye to hopes that its planned Kaufhof takeover could be sealed anytime soon.

Metro AG, the owner of the Kaufhof department store chain, said yesterday (Tues) it decided to put the sale on hold. The statement surprised many analysts. Experts said today Metro may not have received satisfying offers for Kaufhof and therefore planned to delay the takeover negotiations. Metro argued yesterday that the "current situation on the capital market offers no suitable circumstances for such an important transaction."

Metro is one of Europe’s leading retail and wholesale group. The Dusseldorf-based company holds a majority stake in Kaufhof which consists of 140 branches with 18,000 employees. Paris-born investor Nicolas Berggruen – who owns Kaufhof rival Karstadt – and Austria’s Signa are keen on snatching up Kaufhof. Signa, which is headed by Rene Benko, reportedly offered around two billion Euros for all Kaufhof stores.

Benko pledged he would keep investing in the company. German daily Die Welt reports today it is understood that the amount of Benko’s offer resembled the value of all of Kaufhof’s properties. Experts think that Metro hope for twice the sum due to Kaufhof’s prospering activities across Germany.

An acquisition of Kaufhof would be the first major purchase of a retail sector company for Signa which usually focuses on buying and renovating properties in European city centres. Signa is currently engaged in bringing some of the biggest names of fashion and luxury accessories to Austrian capital Vienna. The holding recently said the estate called Golden Quarter would feature between 12 and 15 shops. The company stressed it had no plans to create a department store resembling Harrod’s in London, Great Britain.

Signa is also masterminding ongoing restoration and renovation activities at a former bank headquarter office in the heart of Vienna. Globally represented hotel chain Hyatt agreed with Signa to set up a five-star Park Hyatt hotel in the building. The estate will also feature a 1,500-square-metre Prada store, according to Benko.

Only last week, Signa confirmed reports that Viennese prosecutors stopped examining an alleged case of money laundering. Weekly magazine Format revealed that Austrian authorities started investigating after a Luxembourg-based bank informed them about a suspicious transaction around two years ago.

"Investigations such as these are anything but pleasing, even if one is convinced of not having done anything wrong," Benko said on Friday when being informed that juridical authorities cleared his enterprise from all accusations.

Meanwhile, Austrian real estate company CA Immo is developing into one of the leading developers of properties in neighbouring Germany. The company said yesterday its list of tasks featured projects in some of the country’s biggest cities including Berlin, Frankfurt and Munich. CA Immo explained it would not start new investments in Eastern Europe (EE) this year. The firm said it intended to spend 370 million Euros in 2012 of which 300 million would go to projects in Germany.

Austrian Times

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