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DPA Translated by
Roberta HERRERA Published
January 9, 2025
The German department store chain Galeria Karstadt Kaufhof (GKK) has filed for insolvency at the Essen District court. The company is actively seeking a new owner, and discussions with potential investors have already commenced with the aim of sustaining Galeria’s operations.
“Operational success at Galeria has been constrained by the general conditions of the former ownership structure. Today’s event is distinctly considered a liberating boost,” mentioned CEO Olivier van den Bossche in a statement. The CEO’s statement further noted, “Signa Group’s bankruptcies have significantly harmed Galeria, hindering ongoing activities and severely limiting future development possibilities due to high rents and costly services.”
This is already the third bankruptcy filing for GKK in less than four years, preceded by difficulties faced by the parent company Signa. In recent weeks, several companies within the commercial and real estate group owned by Austrian entrepreneur René Benko had declared bankruptcy, including Signa Retail Selection AG, to which GKK belongs. Signa had announced its intent to orderly liquidate its activities, entailing a sale of GKK.
Germany’s last major department store group had previously sought refuge in a protective procedure in late 2025. In March 2025, the creditors’ assembly had approved the insolvency plan. Signa pledged 200 million euros for restructuring, which was to be disbursed in installments until 2025, with the initial 50 million euros allegedly set for payment in February.
It’s uncertain whether GKK can rely on this payment. Austrian insolvency expert Karl-Heinz Götze from the creditors’ protection organization KSV1870 doesn’t believe so, although he isn’t aware of the corresponding payment agreements. Götze’s organization is part of the creditors’ committee of the holding company’s insolvency. When asked, the judicial administrator of Signa Holding declined to comment.
Concerns for over 15,000 jobs
Concerns for over 15,000 jobs arise after the previous bankruptcy led to the closure of approximately 40 branches. The remaining 18 stores are set to close this month. Currently, Galeria operates 92 department stores and, as per their statement, employs over 15,000 individuals.
The impact that the new insolvency filing will have on the employees remains uncertain. The central works council couldn’t be reached immediately for a statement. During the previous insolvency process, the Federal Employment Agency had provided insolvency benefits to Galeria employees for three months.
In the two previous insolvency proceedings, Galeria’s creditors forgave billions in claims to enable the department store chain to navigate the crisis. The German government also provided significant financial aid: in 2025 and 2025, the Economic Stabilization Fund (WSF) supported the company with a total of 680 million euros. As per the 2025 insolvency plan, the WSF was only expected to recover a small part from the merchandise liquidation.
This time, Galeria Karstadt Kaufhof GmbH has opted for a regular insolvency procedure. The local court in Essen has appointed attorney Stefan Denkhaus (Essen, Hamburg) as the provisional judicial administrator.
Although the management remains in place, all operations necessitate approval from the provisional judicial administrator. Their task involves assessing whether the grounds for insolvency exist and whether the procedure costs are covered. If the conditions are met, the procedure is initiated. The drafting of an insolvency plan can be carried out either now by the management or post the procedure’s commencement by the judicial administrator.