As of: March 18, 2024, 4:28 p.m
By: Markus Hofstetter
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The creditors of the insolvent Signa Prime Selection have approved the restructuring plan.
The properties are sold by a trustee.
Vienna - Signa Prime Selection AG and Signa Development Selection AG, the two most important companies of the insolvent Signa Group, are on the verge of extinction.
On Monday afternoon (March 18th), the creditors will decide on the restructuring plans presented for parts of René Benko's collapsed empire.
The insolvency administrators of both companies have proposed a trust solution.
The aim is to fully realize and distribute all assets over a period of several years.
Around 30 percent of the billion-dollar claims are to be serviced.
The creditors of Signa Prime Selection have now agreed to this model.
In the vote, both the head and the capital majority were achieved and the trust restructuring plan was therefore accepted by the trustees, as the insolvency administrator of this important sub-company announced.
This means that the most prestigious properties will be sold by a trustee in the next few years.
The fate of Signa Development is still unclear.
Creditors decide on Signa's fate: Austria votes against restructuring plans
Wolfgang Peschorn, President of the Austrian Financial Procuratorate and thus the Republic's lawyer, said on ORF radio on Monday that Austria would not agree to the proposed restructuring plans.
The creditors decide on René Benko's business empire.
(Archive photo) © Marcel Kusch/dpa
Peschorn justified the rejection by saying that the liquidity necessary for a gradual sale was not available.
This is necessary in order to wait for a market recovery and to take the time to sell.
“The company can only stay afloat in the next few weeks by selling real estate.”
In addition, it is not certain whether the promised rate of 30 percent can be achieved if the restructuring plan is accepted.
“There is no guarantee,” said Peschorn.
He also once again criticized the lack of transparency.
In his opinion, bankruptcy would bring more clarity.
For example, money could be taken out of the company and then reinvested in new projects.
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When the creditors vote at the Vienna Commercial Court, there must be a majority in terms of people and the amount of the claim.
Peschorn did not want to speculate about how the other creditors would vote.
“We are not guided by the majority, but rather by what is in the interests of the Republic and the taxpayers.”
It is possible that there will be a criminal investigation.
“And I also hope that the criminal authorities will begin targeted investigations here as soon as possible,” said Peschorn.
“In this case too, bankruptcy proceedings would undoubtedly be advantageous for the law enforcement authorities because a liquidator can work very well with them.”
Claims totaling 10.8 billion euros were registered
Signa Prime includes properties such as the luxury hotel Park Hyatt in Vienna, the Selfridges department store in London, the KaDeWe in Berlin, the Alsterhaus in Hamburg, the Oberpollinger in Munich and the Elbtower in Hamburg, which is currently under construction.
Signa Development specializes in the development of urban development projects in the residential and commercial sectors.
According to Creditreform, the real estate portfolio includes 39 projects.
The subsidiaries that hold the shares in the German properties would be exempt from trust management.
However, they should also be liquidated after their properties have been sold, as the insolvency administrator's plan envisages.
In addition, the Austrian trustee would manage Signa Prime's claims against its subsidiaries.
The Signa bankruptcy is the largest bankruptcy in Austrian economic history.
Signa Prime's creditors have registered claims amounting to around 10.8 billion euros.
Of this, the insolvency administrator has so far only recognized around 3.1 billion euros.
There are claims against Signa Development totaling 2.3 billion euros, of which 1.3 billion euros have been recognized so far.