In a joint statement, the two insolvency administrators appointed, Dr. Christian Gerloff from the Munich law firm Gerloff-Liebler Rechtsanwälte and Stefan Meyer from Ulm-based Pluta Rechtsanwalts GmbH, point out that the operational business of the two insolvent Signa Sports United (SSU) spin-offs Tennis-Point GmbH and Internetstores GmbH (alias Internetstores Group, with Addnature, Bikester, Brügelmann, Campz, Fahrrad.de and Probikeshop) will continue. To achieve an appropriate and resilient solution for the future while satisfying creditors in the best possible way, the two insolvency administrators are working closely together on the individual proceedings “given the existing interdependence of the companies.”
A brief recap: The insolvency applications of both SSU brands and SSU itself were filed following the decision announced on Oct. 16, 2023, by SSU majority shareholder Signa Holding GmbH to withdraw its commitment made to SSU N.V. to provide €150 million in additional financing.
The latest insolvencies overview
Here is an updated overview of the insolvencies within the struggling SSU world:
- Signa Sports United N.V. (SSU N.V.) is a company under Dutch law with registered offices in Berlin, Germany. Its shares had been listed on the New York Stock Exchange (NYSE) since 2021 and were delisted again as of Oct. 11, 2023. SSU N.V. has no operating business and is a 100-percent shareholder of Signa Sports United GmbH (SSU GmbH). The provisional insolvency administrator is Dr. Christian Gerloff. Due to a decision relating to a group jurisdiction (Section 3a of the German Insolvency Code), the proceedings are pending at the Local Court of Bielefeld, Germany.
- Signa Sports United GmbH (SSU GmbH), based in Berlin, acts as an umbrella and service company for the operating companies of the SSU Group. It is responsible for central functions such as IT, human resources and finance. The company has around 185 employees. SSU GmbH directly or indirectly holds 100 percent of the shares in Tennis-Point GmbH, Internetstores GmbH and a total of 31 direct and indirect domestic and foreign companies. In addition, all of the Group’s IT services are pooled in this company. The provisional insolvency administrator is lawyer Stefan Meyer. The Local Court in Bielefeld also handles these proceedings based on the group jurisdiction ruling.
- Tennis-Point GmbH, based in Herzebrock-Clarholz, Germany, and employing just under 400 people, sells a wide range of tennis products and operates various online stores (including www.tennis-point.de), 13 brick-and-mortar stores in Germany and 20 other stores in other European countries via subsidiaries. The proceedings are pending at Bielefeld Local Court; the provisional insolvency administrator is Dr. Christian Gerloff.
- Internetstores GmbH, based in Stuttgart, Germany, operates over 32 online specialist stores for bicycles, bicycle accessories, sporting goods and outdoor products (including www.fahrrad.de) with around 470 employees. The company also operates brick-and-mortar bicycle stores in Germany and Sweden. The Stuttgart Local Court has appointed Dr. Christian Gerloff as provisional insolvency administrator.
- Publikat GmbH, based in Großostheim, Germany, is a logistics company of the group, which mainly provides its services for the former group company Outfitter GmbH (sold shortly before the SSU blackout) and Internetstores GmbH. The company employs around 300 people. The provisional insolvency administrator is Stefan Meyer; the proceedings are being conducted via the group court in Bielefeld.
In the first few days after the respective insolvency applications were filed, the main focus was on stabilizing and continuing business operations at Tennis-Point and Internetstores and also at their parent company Signa Sports United GmbH and Publikat GmbH. To this end, a large number of negotiations were successfully held with suppliers, trade credit insurers, service providers, creditors and lenders.
Tennis-Point and Internetstores: Business as usual
According to the provisional insolvency administrators, they have already been able to implement important measures to continue business operations and initiate initial steps for future solutions. At Tennis-Point and Internetstores, an agreement has already been reached with the provisional creditors’ committees on how to proceed. The operational business of both companies will continue. All brick-and-mortar stores will remain open. Even returns of goods and claims relating to both old orders (before the insolvency) and new business will continue to be processed reliably: “The teams at both companies are currently working tirelessly to offer customers the usual rapid service, even if there may still be delays in some cases.”
Salaries secured until the end of 2023
In addition, the employees of all companies with insolvency proceedings will receive insolvency money from the Federal Employment Agency for October, November and December 2023. The necessary prefinancing of the insolvency money has been initiated and is at an advanced stage.
Prospective buyers for Tennis-Point and Internetstores come forward
To achieve viable future solutions for both companies under new ownership, it is also planned “in consultation with the respective provisional creditors’ committees to set up structured (separate) investor processes for Tennis-Point and Internetstores in the near future.” Furthermore, “The insolvency proceedings at SSU N.V. and SSU GmbH depend crucially on the progress and results of these investor processes and are therefore indirectly involved in the investor processes. Over the past few days, a large number of interested parties from Germany and abroad have already actively registered for both companies and will be involved in the structured processes. An investor solution that includes the activities of both Tennis-Point and Internetstores is conceivable but is not currently being pursued as a priority.”
Insolvency administrator Gerloff commented: “Tennis-Point and Internetstores have a strong international market position in their respective segments of the sports market and a loyal customer base. The teams at both companies are also highly motivated to continue providing their customers with the best possible service. The considerable number of addresses that have already actively expressed their interest shows that the opportunities for good future solutions are fundamentally given.”
“The separation of important operational parts of the Signa Sports United Group as part of the investor processes is undoubtedly a complex and challenging task considering the close integration within the Signa Group,” adds insolvency administrator Meyer. “It is, therefore, all the more important that the individual insolvency proceedings are optimally coordinated to find the best solution for creditors, customers and employees. I am confident we will find good solutions here with the motivated employees and the Gerloff Liebler team.”
SSU GmbH and Publikat at risk?
While the future of Tennis-Point and Internetstores Group seems to be secured thanks to domestic and foreign interest in a takeover, the question of how things will continue with service provider SSU GmbH and logistics company Publikat GmbH remains open for the time being.
What about WiggleCRC?
It will also be interesting to see what happens to the British online sports retail group WiggleCRC, which also belongs to SSU and includes Chain Reaction Cycles Limited, Chain Reaction Cycles Retail Limited and Hotlines Europe Limited. WiggleCRC also filed for insolvency on Oct. 27, with Anthony John Wright and Alastair Rex Massey from FRP Advisory taking over as administrators. According to insiders, it is currently unclear whether Mapil Topco Limited, the actual parent company of the group, which is located directly under Signa Sports United, will also be placed in insolvency administration.
According to rumors in the UK, Frasers Group plc is already in the starting blocks. Among other things, Frasers manages the sporting goods retailer Sports Direct International and acquired the German omnichannel retailer SportScheck from Signa Retail Department Store Holding GmbH (majority shareholder of SSU) on Oct. 17 of this year. Sports Direct is also already active in the bicycle business: Evans Cycles was acquired in 2018. According to media reports in the UK, Evan Cycles, in turn, reportedly acquired fellow countryman and online bike retailer ProBikeKit, founded in 1998.
What could happen next?
According to the German Manager Magazin, the Austrian real estate tycoon and Signa founder René Benko, who stands at the very beginning of the entire Signa saga, has signaled his intent to pull out of the real estate and retail group in light of the crisis at Signa Holding. While some investors are said to have already withdrawn, others reportedly wrote a personal letter to Benko asking him to withdraw from the company to make a rescue of the Group possible. Manager Magazin also wrote that if Benko retires, the restructuring expert Arndt Geiwitz, who had already gained a reputation in the insolvency proceedings of the German Galeria-Kaufhof department store chain and the German Schlecker drugstore chain, is to take over the holding company. Signa shareholder Hans Peter Haselsteiner, an Austrian entrepreneur and former politician, reportedly confirmed this information.
The future of Signa Holding also plays a role for many other well-known companies, including the The KaDeWe Group under the umbrella of Signa Retail’s Premium Group, which is also responsible for Selfridges. In 2021, Signa acquired the Selfridges Group, one of the world’s leading luxury department store groups, together with Central Group for £4 billion. Apart from that, there are many other business units in Signa’s various Real Estate, Retail and Media divisions.
The British Telegraph is currently also reporting that SportScheck “management may have to call in administrators as soon as Monday.” Frasers isn’t expected to complete the mentioned deal until January 2024, meaning the financing needs could be significant over the next few months.
SGI Europe will keep you informed of any further developments.
