Signa Holding, a prominent company, has officially entered insolvency. The main enterprise of entrepreneur Rene Benko filed for a resembling bankruptcy procedure in Austria. Benko's property holdings, that once had an estimated value of up to $30 billion, now face uncertainty as Signa seeks restructuring, with Benko yielding control to a restructuring manager.
Signa's substantial assets include shares in large European department stores, luxurious British retailer Selfridges, and the Chrysler Building located in Manhattan. Benko bought these assets in 2019, partnering with RFR Holding, another renowned company headed by Aby Rosen. An RFR spokesperson has confirmed that the company is willing to increase its holding if Signa decides to offload its assets.
Despite a downturn in the property market and rising interest rates, Benko continued to invest. One of his notable investments was in Swiss luxury department store chain Globus, which he acquired with Central Group, a company from Thailand. This acquisition took place after the onset of the pandemic and was followed by the procurement of a major part of Selfridges in 2021.
According to estimations made by analysts from JPMorgan Chase, Signa’s two largest subsidiaries bear more than $14 billion in liabilities and debt. This includes over $4.5 billion of floating rate debt, with more than $1 billion of the total debt scheduled to be repaid within the year. Furthermore, 37 percent of the debt is set to mature within the next four years.
Banks also have substantial monetary involvement with Signa. Swiss bank Julius Baer has lent approximately $690 million to Signa, while the exposure of Austrian corporation Raiffeisen Bank International amounts to around $830 million.
The substantial impact of Signa’s insolvency has led the European Central Bank to closely monitor the procedure to anticipate any widespread effects.
Benko's professional journey has been an eventful one. At the age of 46, he has experienced a meteoric rise and subsequent fall in the real estate sector. Starting out by renovating apartments, he swiftly climbed the ladder, acquiring a majority of the Karstadt department-store chain in 2012 and expanding his portfolio extensively from that point on.
However, the journey has not been without legal confrontations. Benko faced a tax fraud conviction in 2012 after accusations of attempting to bribe Italian officials. More recently, he was acquitted on charges of bribery in Austria this year.
