Arndt Geiwitz (l), representative of Galeria Karstadt Kaufhof and Frank Kebekus, trustee, during the second insolvency of Galeria Karstadt Kaufhof. dpa
Galeria Karstadt Kaufhof (GKK) filed for bankruptcy at the Essen district court on Tuesday morning. The Hamburg lawyer Stefan Denkhaus will be the administrator. According to our information, the department store chain’s board sees the move as a liberation move to free itself from extortionate rents from the parent company Signa and horrendous consulting contracts. New research from us reveals new, secret consulting fees. Accordingly, the Seitz law firm collected seven million euros for eight months of work as an external consultant during GKK’s second insolvency. Seitz advised on personnel issues during the restructuring, including job cuts.
On Tuesday morning, Olivier van den Bossche filed for bankruptcy at the Essen district court. The CEO of Galeria Karstadt Kaufhof opened the third restructuring process of the crisis-ridden department store chain. According to our information, the insolvency has been prepared internally for weeks; we reported exclusively on it at the end of December.
Until the end, the GKK management was still waiting to see whether the promised 200 million euros from the parent company Signa would come. In vain. Signa Holding is currently in the process of falling apart, and more and more subsidiaries are filing for bankruptcy.
Van den Bossche and his finance chief Guido Mager were also hoping for an investor who could step in at the last second to buy the company. However, our research shows that there is currently no offer on the table despite ongoing discussions with potential interested parties.
Signa legacy issues: millions in costs for consultants, horrendous rents
So now another bankruptcy. However, Mager and Van den Bossche do not see this as a defeat, but rather as a liberation, because the bankruptcy enables the group to rearrange bad old contracts, for example with consultants. Under the reign of the Signa Group, numerous consultants earned double-digit millions from the department store group. We reported exclusively that the general representative Arndt Geiwitz, his law firm and employees collected 52 million euros for eight months of work during the second insolvency proceedings. The consultant fees were kept strictly secret at Galeria Karstadt Kaufhof.
New research now shows that the Cologne law firm Seitz also earned a decent amount of money as an external consultant during the second insolvency. Seitz and his employees earned seven million euros for eight months. The law firm primarily took care of personnel matters and negotiated salaries and staffing plans with the Verdi union and the staff council. The law firm left a list of questions unanswered.
Another consulting firm that earned very well from GKK even outside of the bankruptcy was Retail Capital Partners. According to our information, the company collected 17.4 million euros in the past 2022/23 financial year, and another ten million euros during the bankruptcy in the same year, for a total of 27.4 million euros. Money that the department store chain urgently needs today.
The consultants have now been mandated for around ten years and are responsible, among other things, for the online shop. A few years ago they predicted online sales of one billion euros by 2023. A pipe dream, because the online shop was still in loss last year and only went into the black for the first time at the turn of the year 2024. Insiders wonder why the consultants continued to be hired given their limited success. The “FAZ” also reported on the incident.
More than half the rent for a fraction of the properties
Another problem that Galeria Karstadt Kaufhof had to deal with due to its contractual relationships with the Signa Group is rent. 18 of 92 GKK branches belong to Signa, but the department store chain paid more than half of all rental costs for this small portion of real estate. This emerges from internal documents that we have available. Accordingly, GKK paid 350 million euros for rent and leasing in the past financial year, around 200 million of which is said to have flowed to Signa.
Insolvency now enables the GKK management to quickly terminate these current contracts with consultants and landlords.
According to our information, the GKK board has the backing of the federal government. The move into bankruptcy is viewed favorably there, especially in order to free itself from the Signa legacy. In addition, CEO Van den Bossche is trusted in Berlin; there is the impression that the manager has a plan and really wants to save the company, high-ranking officials report.
The CEO also conveys this impression to his works council, which thinks highly of him. According to the employee bank, Van den Bossche delivered the first part. The online shop has become profitable and the Christmas business has gone so well that the company is in the black. If only it weren’t for the Signa misery that is dragging down the department store chain. Now the department store chain has the chance to possibly make it back on its own. It remains to be seen whether the state will ultimately step in again. The federal government, which is still one of the creditors, says that they first want to wait and see what the insolvency plan looks like and what the future of GKK could ultimately look like. However, in the short term, as of now, they will not be stepping in.