The department store chain Galeria Karstadt Kaufhof has filed for creditor protection in a court in Essen, Germany.
The court immediately granted the request and initiated the insolvency process, which will allow the department store to continue operating while it works on a recovery plan.
The group had already requested assistance from the German State Bank, but did not receive it in time. In a statement, the management of the Karstadt Kaufhof Gallery stated that the assistance process took too long.
The group will use judicial protection to maintain its restructuring efforts. The Signa Group, owner of the chain, also promises additional funding of several hundred million euros.
Large department stores have been severely impacted by the coronavirus crisis. Losses exceed eight million euros per week due to mandatory closures. In Germany, the Karstadt Kaufhof department store employs more than 28 people.
