Under pressure from his billionaire investors, the original company mastermind Rene Benko has to hand over the helm to reorganizer Arndt Geiwitz. “We don’t yet know how bad it is,” said Signa investor Hans-Peter Haselsteiner in the “Tiroler Tageszeitung” at the weekend. Without new money from all fellow investors, nothing will happen. But the first investors apparently want to be paid out.
The German expert Geiwitz is supposed to save the matter and Benko is no longer in charge of the Signa advisory board. The short-term debts are said to amount to 2 billion euros – of which 1.3 billion euros are to be serviced this year. “Working this out is now the number one task of the restructuring officer Geiwitz,” said Haselsteiner to the “Tiroler Tageszeitung”.
- Also read: Haselsteiner about Benko’s Signa: “Some mistakes have left their mark”
Time is running out. An agreement is being negotiated among investors. There is also talk in German media reports of a “temporary” relinquishment of voting rights by Benko. Haselsteiner had announced that Benko was basically ready to do this, without specifying a time period. The “Welt am Sonntag” writes that after years of big dividends, Benko has allegedly been approaching investors for fresh capital for months. Signa was still saying in the spring that the situation was good despite the interest rate turnaround and the war in Ukraine, and that even projects like Hamburg’s first skyscraper, the Elbtower, were very solidly financed. The construction freezes impressively signal the opposite.
According to “Welt”, important investors such as Roland Berger have already announced that they want to cash out. But it is unclear whether this is even financially possible.
- The backgrounds: Rene Benko is retiring as head of the Signa advisory board
It is difficult to assess from the outside what the Signa Group’s finances really are. Leonhard Dobusch, economist and scientific director of the employee-oriented Momentum Institute, who has been involved with the group for a long time, also said this, according to ORF radio Ö1 (Saturday). However, the group probably needs fresh money quickly to maintain its business model, explains Dobusch.
In the course of his withdrawal, Benko is demanding – probably absolutely necessary – contributions from the international, billion-dollar co-shareholders that he had originally brought on board. “Nobody knows how high the amount is,” Haselsteiner refers again to Geiwitz. According to “TT”, Haselsteiner hopes that all shareholders will go along with it: “Otherwise it won’t work.” He himself has 15 percent invested in Signa through a foundation.
Their structure is overall opaque. Media inquiries have recently not been answered. There was no new information from Geiwitz or his press office over the weekend. It remains to be seen whether all international investors are prepared to invest, as Haselsteiner hopes, without at least publicly estimating any sums. Orderly sales and a reorganization would of course be far less costly than a second Kika/Leiner, as Haselsteiner recently said in the “Standard”.
- More on the subject: Twilight of the Gods: The Problems of Musk and Benko
The “Kleine Zeitung” (Sunday) states that the majority of Signa’s liabilities are bank debts with the largest creditors being the Raiffeisen Group and Bank Austria. According to media reports, the debts of Signa Prime (including KaDeWe Berlin) are said to have totaled 10.8 billion euros at the end of 2022. The result also turned significantly into the red; after a profit of 700 million euros in 2021, the loss in 2022 was 1.019 billion euros. As early as 2022, the liabilities would no longer have been able to be serviced using our own resources, writes the “Kleine”. Without a capital increase of 750 million euros, Signa Prime would have been threatened with insolvency last year.