The Signa Retail group is expanding its hold on the German retail sector by taking over all the shares it doesn't own in Galeria Karstadt Kaufhof, the joint venture it formed last year with Hudson's Bay Company of Canada. Signa is paying about one billion euros for the assets, which include the real estate that was previously shared. The announcement came just as HBC announced plans to withdraw from the stock exchange.
HBC had acquired the financially weak Galeria Kaufhof chain of department stores from the Metro Group in 2015 for €2.8 billion, but it did not make a return on the investment after various measures. Among others, it converted six of its former Kaufhof Sportarena stores into factory outlets called Saks-Off-5th-Avenue. It integrated the operations of two other Sportarenas into local Kaufhof department stores and closed the remaining four others.
Last year, HBC allowed its German operations and its GB Inno department store in Belgium to merge with Signa's Karstadt chain of department stores, with Signa retaining a controlling stake of 50.1 percent and taking over the management. Stephan Fanderl, the Signa strongman who heads up the joint venture and the whole Signa Retail group, said that HBC's pullout will facilitate the integration and rehabilitation of Galeria Karstadt Kaufhof. The closing of the transaction is expected to take place in the autumn.
Founded in Austria by René Benko in 1999, the Signa Group now owns more than €14 billion worth of real estate and controls retail operations that generate annual sales of more than €7.5 billion – including €750 million online through more than 100 web stores operating in 20 countries. Besides the Signa Department Store Group and three other business units, it owns Signa Sports United, which controls the Karstadt Sports chain of sporting goods stores and various online sales operations in the same sector.
Galeria Karstadt Kaufhof aims to focus more on the sporting goods segment in the future, as – according to Karstadt Sports – it presents a strong potential for growth. With this in mind, Galeria Karstadt Kaufhof is believed to be planning to convert all the eight German stores in its off-price Saks-Off-5th chain back into sporting goods stores, which will operate as Karstadt Sports branches, according to Textilwirtschaft.
Karstadt Sports is also expanding its executive board next month, according to the German news service, with the appointment of Stefan Weiss to the newly created position of chief sales officer. Reporting to Jens Dunkle, chief executive of Karstadt Sports, he will start on July 1 and will be responsible for visual merchandising and the coordination of sales efforts.
Weiss, 44, had worked for Karstadt Sports and the Karstadt department store chain before he joined Sport Scheck in 2009. He held several senior positions at the German sporting goods retailer until 2016. The next year, he rejoined Karstadt Sports, running Karstadt Sports' stores in Cologne, Essen and six other stores in the western part of Germany.
Karstadt Sports currently manages 28 stores, employing a total of 1,200 people in Germany.
