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Real estate company Signa Prime to be wound up by trustee

The most prestigious properties of the largely insolvent Signa Group will be sold by a trustee over the next few years. The creditors of Signa Prime Selection AG approved this plan on Monday in Vienna, as announced by the insolvency administrator of this important sub-company.

Signa Prime is considered the jewel in the crown of Austrian investor René Benko's Signa Group, which has slipped into crisis as a result of rising interest rates, construction costs and energy prices. The Prime portfolio includes the still unfinished Elbtower in Hamburg, the luxury department store KaDeWe in Berlin, properties belonging to the department store chain Galeria Karstadt Kaufhof and the building of the Austrian Constitutional Court.

According to the latest data from insolvency administrator Norbert Abel, creditors of Signa Prime have registered claims of around 12.8 billion euros. The administrator has so far only recognized around 5.9 billion euros of these claims.

Process of up to five years

According to his proposal, all properties are now to be sold by him as trustee in an orderly manner over a period of three to five years in order to benefit from an expected recovery on the market. This should settle at least 30 percent of the claims.

For tax reasons, Signa Prime's German properties are not formally placed under the control of the trustee, but de facto the trustee retains control over Signa Prime's approval rights and outstanding receivables from its sub-companies.

The creditors' meeting in Vienna only dealt with the liquidation of Signa properties, not the sale of department store operations such as KaDeWe and Galeria Karstadt Kaufhof. However, these retailers, which also belong to the Signa Group, are also insolvent and are looking for buyers. In Switzerland, the luxury department store chain Globus is partly part of Benko's corporate empire.

©Keystone/SDA

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