Economy Galeria Karstadt Kaufhof
Department store group confirms – These 16 branches will close at the end of August
Status: 27.04.2024 | Reading time: 3 minutes
Galeria Karstadt Kaufhof is closing 16 branches at the end of August
Germany’s last department store group, Galeria Karstadt Kaufhof, is once again closing numerous stores at the end of August. Three federal states are particularly affected. Galeria will also receive a new headquarters.
The department store group filed for bankruptcy in January. Galeria Karstadt Kaufhof has now confirmed that it will close numerous branches at the end of August. Berlin, Bavaria and North Rhine-Westphalia are particularly affected. 1,400 employees are to be laid off.
The financially troubled department store group Galeria Karstadt Kaufhof is closing 16 of its 92 branches on August 31 this year. This was announced by insolvency administrator Stefan Denkhaus on Saturday. Berlin (Ringcenter, Spandau, Tempelhof), North Rhine-Westphalia (Essen, Köln Breite Straße, Wesel) and Bavaria (Augsburg, Regensburg Neupfarrplatz, Würzburg) are particularly badly affected by closures, with three stores each. In addition, these department stores are supposed to close: Chemnitz, Leonberg, Mainz, Mannheim, Oldenburg, Potsdam, Trier Fleischstrasse.
Of the approximately 12,800 people the company employs, 11,400 should keep their jobs. 1400 will have to go. According to Galeria, a reconciliation of interests and a social plan were concluded with the general works council on Friday. “We will do everything we can to lead our business into a successful future. We see good conditions for this, not least due to our sales development in the current financial year,” said Galeria boss Olivier Van den Bossche. The company’s headquarters are to move from Essen to the Düsseldorf Shadowstrasse branch.
The department store group filed for bankruptcy at the beginning of January. It is the third bankruptcy within three and a half years. At the time, Van den Bossche cited, among other things, the insolvencies of the Signa Group of the previous owner René Benko as the reason for the difficult situation. It has been known since the beginning of April that a consortium made up of the US investment company NRDC and entrepreneur Bernd Beetz’s company BB Kapital SA wants to take over the department store chain.
However, the agreement concluded between investors and Galeria will only come into effect if the creditors agree. Insolvency administrator Denkhaus wants to present the insolvency plan for the change of ownership by the end of April. The plan will not be legally binding until the creditors’ meeting approves it on May 28 and it is then reconfirmed by the court. Denkhaus wants to hand over the company to the new owners by the end of July.
Union demands a viable concept
The Verdi service union has sharply criticized the closure plans. “Every location that is closed leads to further desolation of our inner cities. “What the employees have to endure goes far beyond what is bearable,” said Verdi federal board member responsible for trade Silke Zimmer on Saturday in Berlin. Once again, the impression arises that the employees are becoming pawns in a rental poker game. The often overpriced rents have to be negotiated with landlords.
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“There is such a need in retail that employees can be accommodated immediately”
According to the online job portal Indeed, the job prospects for terminated employees of the Galeria Karstadt Kaufhof retail group are not bad. “The affected retail employees are likely to find a new job quickly, because the demand for employees from this professional group is currently comparatively high despite Germany’s difficult economic situation,” said labor market expert Annina Hering from Indeed on Saturday, according to the announcement.
In Germany, significantly fewer people are currently being sought in almost all sectors than in the previous year. However, the retail and medical professions were an exception, with increased demand for new staff of more than 6 percent each compared to 2023. “I am therefore confident that most of the Galeria Karstadt Kaufhof employees who are now losing their jobs will soon find themselves in permanent positions again,” emphasized Hering. In the best case scenario, a new employment contract with improved conditions is even possible.
However, the labor market expert admitted that the approximately 450 employees who will lose their jobs at the company headquarters will probably have a more difficult job search. The market for office jobs has recently declined.
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The Berlin-Brandenburg trade association also sees good prospects for the employees of the branches that are being closed by the retail group. “There is such a need in retail that employees can find accommodation immediately,” said managing director Nils Busch-Petersen on Saturday to the dpa.