Signa credit protectors plead for creditors’ committee
Published: Tuesday, Dec 5th 2023, 10:10
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Many questions remain unanswered regarding the bankruptcy of Austrian Rene Benko's Signa Group. Creditors' representatives are now hoping for more clarity from a so-called creditors' committee. Specifically, information about liabilities, assets and the next steps in the restructuring process of the insolvent Signa are to be clarified.
On Tuesday, creditor advocates spoke to the Austrian broadcaster ORF's Ö1 "Morgenjournal" program in favour of setting up such a committee. This would have to be set up by the responsible judge. It would then consist of three to seven members, support and monitor the insolvency administrator and generally ensure greater transparency, according to the report.
"At a creditors' committee, we can ask the insolvency administrator the questions that are already burning under our nails," said Karl-Heinz Götze, Head of Insolvency at the organization "Kreditschutzverband von 1870", to Ö1, because much is still unclear.
"We currently don't know at all how the liabilities are positioned. We don't know what the restructuring plan looks like. We don't know what the next steps will be. We don't know what the financing looks like," says Götze.
Objective Creditors' Committee
All of these issues could be addressed in a creditors' committee. There could also be a debtor representative who has more information. However, Cornelia Wesenauer from the Alpenländische Kreditorenverband added that there are major discrepancies not only in the liabilities, but also in the assets, i.e. the ownership structure, and that she would also approve of a creditors' committee.
In the balance sheet for 2022, the assets were valued at around 5 billion euros; at the opening of insolvency proceedings (with status 30.9.2023), these would only be valued at around 2.5 billion euros according to the book value.
The asset liquidation value - i.e. the value that would be realized in the event of a forced sale - would only be around 300 million euros. "That's five percent of what it was supposedly worth nine months earlier," says Wesenauer.
It is also unclear what will happen to Signa Holding's two large subsidiaries, Signa Prime Selection AG and Signa Development AG. According to their respective annual reports for 2022, both companies have liabilities totaling EUR 14 billion.
According to a report in the Austrian newspaper "Kurier" on Tuesday, Signa Prime Selection accounts for around EUR 11.5 billion and Signa Development for around EUR 2.8 billion. In the previous year, Signa Prime posted a loss of around one billion euros, while Signa Development also closed 2022 with a loss of just over 300 million euros.
Globus also in debt restructuring moratorium as a Signa subsidiary
In Switzerland, the parent company of Magazine zum Globus AG, as the Globus department store group is officially known, has also applied to the competent court for a debt restructuring moratorium. This step is intended to prevent the Swiss Signa Retail Selection AG from becoming dependent on the insolvency proceedings of the Austrian parent company.
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