German Praktiker reviews units to file for insolvency
The German retailer Praktiker in Hamburg is seen in this file photo. REUTERS photoGerman do-it-yourself retailer Praktiker said late Wednesday its management board was no longer sticking to the assumption that the group could continue its businesses after financing talks with creditors ended without agreement.
“The management board of Praktiker AG has denied the positive continuation forecast for Praktiker AG and certain entities within the Group,” the company said in a statement.
The company said it lacked liquidity and was heavily in debt, which it said were grounds for insolvency under German law.
“The Management Board will carry out a review in relation to the Group in order to determine the entities in relation to whom insolvency petitions will have to be filed and will then publish the results of this review as soon as possible,” the company said.
It said negotiations on a further restructuring of its finances were “unsuccessful” on Wednesday evening “because certain creditor groups did not provide approval for such financing.”
The company said it needed an “alternative financing solution” after the sale of its stake in Luxembourg-based unit Batiself SA could not be completed by the buyer.
430 shops in 9 countries
Praktiker, which runs 430 shops in nine countries, has been trying to improve its fortunes with store refurbishments after big discounts to entice customers led to losses. A cold, wet European spring compounded its difficulties.
The company had nine shops in Turkey as well, but it decided to close all down at the beginning of 2013.
A spokesman for Praktiker had declined to comment on the company’s financial situation. He said the board was meeting on Wednesday but declined to say which topics were being discussed.