Arcandor Bankruptcy

After several weeks of unfruitful negotiations - with potential suitors, and also with the German government - Arcandor has today filed with the Essen District Court to open insolvency proceedings. Principal subsidiaries, Karstadt, Warenhaus, Primondo and Quelle, have also applied for protection from their creditors. Thomas Cook, which is majority owned by Arcandor, is operationally and financially distinct from the other parts of Arcandor, and is therefore unaffected by the insolvency proceedings. Overall, this procedure affects some 43,000 employees, although their salaries are protected until August as part of the insolvency allowance.

Reports have suggested that Metro is still interested in buying some 60 Karstadt stores, and Otto - which is considered to be the world's largest mail order firm - might be interested in parts of Primondo.