Arcandor protests
May 27, 2009
Speaking briefly to the loud and boisterous crowd gathered in front of his office, Economics Minister Karl-Theodor zu Guttenberg promised a thorough examination of the company's application for government guarantees.
Guttenberg said he expected a decision to be made as quickly as possible within the next few days.
Arcandor CEO, Karl-Gerhard Eick, has asked the government for 650 million euros ($905 million). Without the money, Arcandor could go bankrupt by mid-June, he said. The department store and tourism company has been squeezed for years by the discount and luxury sectors.
Essen-based Arcandor is looking to get rid of its premium stores, KaDeWe in Berlin, Oberpollinger in Munich and Alsterhaus in Hamburg, and focus on its mid-level segment.
Eick says he sees no alternative to a government bailout, which may be why Guttenberg, Finance Minister Peer Steinbrueck and Vice-Chancellor Frank-Walter Steinmeier have changed their tune in recent days, suggesting that the government could step in after all.
The change in tone gave Arcandor shares a boost on the Frankfurt stock exchange where the company's stock soared more than seven percent in afternoon trading on Wednesday, after plunging 20 percent on Monday.
Eick also announced a second delay in the release of Arcandor's semi-annual financial report until June 18, citing the ongoing negotiations for government funds.
gb/dpa/AFP/Reuters
Editor: Susan Houlton