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Department store group Galeria applies for further state aid

FRANKFURT (dpa-AFX) – Germany’s last large department store group Galeria Karstadt Kaufhof has applied for further state aid in order to be able to cope with the Corona crisis. Galeria CFO Guido Mager said in a conversation published on Tuesday with the “Frankfurter Allgemeine Zeitung” that the application for additional millions from the Federal Government’s Economic Stabilization Fund (WSF) was made over the weekend. “We expect a benevolent decision this calendar year.”

According to Mager, it is not yet clear how much money the retail giant will need in the end. “The current pandemic scenarios range up to an amount of 220 million euros. Hopefully we don’t need this amount,” he said. Everything depends on how the development goes in the next few months.

The department store group belongs to the corporate empire of the Austrian real estate billionaire René Benko. Galeria had already received a loan of 460 million euros from the WSF earlier this year to ensure liquidity in the pandemic.

Galeria was then on a very good path and even hired 2500 new employees in the first half of the year, said Mager. But the high numbers of infections, 3G in local transport, 2G in retail, the cancellation of Christmas markets and Sunday shopping would have led to a sharp drop in visitor numbers in the city centers.

“It’s like a kind of lockdown in the middle of the Christmas season,” he said. The group now expects sales to decline by 40 percent in December. Due to this recent pandemic, Galeria asked the Economic Stabilization Fund for a supplementary interest-bearing loan. This option was already provided for in the first contract in the event of further pandemic waves.

Galeria is a large employer with around 17,000 jobs subject to social insurance – 20,000 with subsidiaries, the manager emphasized. And the company is “systemically relevant for German city centers”. Mager said: “When department stores close, it has a full impact on the inner cities – especially on medium-sized and small ones.” / Rea / DP / nas

Reference-www.finanzen.at

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