Arcandor trouble
July 17, 2009
Piepenburg, a lawyer and one of Germany's leading business restructuring experts, has resigned.
German media quotes Piepenburg as saying that plans to revive the company were not on a solid foundation and that there was no support from Arcandor's main shareholder Sal. Oppenheim jr. Cie.
Piepenburg's departure increases the odds that Arcandor's ailing department store chain Karstadt as well as its troubled mail order business Primondo will be sold off in parts.
Arcandor also holds 53 percent of UK travel retailer Thomas Cook, and it is now believed that creditors will become more aggressive in seeking to acquire a stake in Cook which was used as collateral with a group of eight lenders last last year.
The departure of Piepenburg is also a setback for Karl-Gerhard Eick, Arcandor's chief executive, who wants to keep the three companies together. But he remains optimistic.
"Until the middle of August, I will welcome every opportunity for investors to implement a recovery plan, to save Arcandor AG and its jobs," Eick was quoted as saying in German media.
Last month, while the government refused to help out Arcandor, another of Arcandor's troubled firms, mail-order retailer Quelle, received government loan guarantees to the tune of 50 million euros from the German state of Bavaria which allowed it to pay its bills and keep operating.
av/Reuters/dpa
Editor: Chuck Penfold