Thailand’s Central Group announced on Friday that it has bought the iconic KaDeWe department store in Berlin from insolvent Austrian real estate giant Signa.
The 650,000-square-foot (60,000 square meter) store is located on one of the German capital’s main shopping streets and has long been a major tourist attraction.
The Thai group, a multinational conglomerate with an extensive retail and real estate portfolio, did not confirm the purchase price, but German newspaper Handelsblatt put the amount at about one billion euros ($1.1 billion).
The news comes several months after the company that runs the store, the KaDeWe Group, filed for bankruptcy, reportedly blaming the turmoil engulfing Signa.
“We are delighted to add KaDeWe Berlin to Central Group’s historic portfolio of luxury retail properties,” said Central Group CEO Tos Chirathivat.
Vittorio Radice, board member of Central Group Europe, said the purchase was “the first major milestone for us in the effort to restore and restructure the operating company of the KaDeWe Group towards a sustainable, financially viable business”.
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Central Group is already the majority shareholder in the KaDeWe Group, with a 50.1% stake.
Handelsblatt reported that the Thai group was in advanced talks to acquire the entire group, which also operates the Alsterhaus department stores in Hamburg and Oberpollinger in Munich.
KaDeWe, short for “Kaufhaus des Westens” or “Department Store of the West”, first opened its doors in 1907 and is one of Europe’s largest department stores.
When Berlin was divided during the Cold War, its well-stocked shelves symbolized Western capitalism and consumerism, a stark contrast to life in the communist East.
Apart from the problems caused by the crisis at Signa, it has suffered like other department stores as customers increasingly choose to shop online.
Signa — which owns the Chrysler Building in New York — filed for bankruptcy in November, marking the spectacular fall of its founder, self-made Austrian tycoon RenΓ© Benko.
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Central Group has been a long-standing business partner of Signa.
Late last year, it also ended another partnership with the Austrian group, becoming the majority shareholder in the group that runs the historic British department store Selfridges.
Source: AFP