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Arcandor/Karstadt Applies for Rescue Loan

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Last Friday Arcandor AG, owner of (among other companies) Karstadt and Karstadt Sport department stores in Germany which sell a wide variety of bikes and bike products, has applied to the German finance ministry and ministry of the economy for a rescue loan of 437 million euros. Yesterday an Arcandor spokesman said that the company will have to announce today

Arcandor/Karstadt Applies for Rescue Loan

ESSEN, Germany – Last Friday Arcandor AG, owner of (among other companies) Karstadt and Karstadt Sport department stores in Germany which sell a wide variety of bikes and bike products, has applied to the German finance ministry and ministry of the economy for a rescue loan of 437 million euros. Yesterday an Arcandor spokesman said that the company will have to announce today postponement of payments when there’s no solution coming from the government.

The rescue loan has a term of six months and will provide the company with the liquidity needed to continue its operations. During this period Arcandor AG that next to Karstadt also owns Quelle (internet sales) and Thomas Cook (travels), is to enter into talks with Metro AG to discus the take-over of 60 of the current 108 Karstadt and Karstadt Sport department stores. Through these stores bicycles are sold under the brand names Hon (folders), Torpedo, Kettler, Alex and Scott as well as a broad range of P&A products for bicycles. The Galeria Kaufhof sports department stores currently do not offer bikes and/or bike products.
 
Metro AG is (among others) the parent company of Kaufhof and operates 126 Galeria Kaufhof sports department stores in Germany as well as 15 stores in Belgium and 13 sport stores called Sportarena. Kaufhof’s turnover stands at € 3.5 billion and was able to write black figures on 2008 with a € 113 million profit. Karstadt however was in the red with a € 272 million loss on a total turnover of € 4.1 billion.

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