Property giant Signa dissolves three top oversight bodies

Troubled European property company Signa has dissolved three top oversight bodies, including the group executive board that oversees strategy, the company said on Thursday.

It was the latest twist in the saga around Signa, the biggest casualty so far of Europe's property crisis. It came on the same day as news that arbitrators rejected the demand of an investor, Abu Dhabi sovereign wealth fund Mubadala, for 713 million euros ($783 million) in compensation.

The holding company of Signa — a group of some 1,000 companies, with high-profile projects and department stores across Germany, Austria and Switzerland — filed for insolvency last month with around 5 billion euros ($5.47 billion) in debt.

Ads

This week, Signa creditors were told that the company was holding talks to potentially sell its stake in New York's Chrysler Building and is shedding its private jet.

Signa's now disbanded executive board was founded in 2013 and members were responsible for strategy, acquisitions, compliance, corporate governance, and fundraising and banking management, according to Signa.

A second dissolved body is a group advisory board that included Signa founder Rene Benko, the former Austrian chancellor Alfred Gusenbauer, and prominent figures in German and Swiss business.
The third is an advisory board of Signa Retail.

A person with knowledge of the matter said that the dissolution of the boards would save costs because members were paid.

Signa's court-appointed insolvency administrator announced the claims by Mubadala, saying they were made in expedited arbitration proceedings and rejected.

An appeal against the decision is not possible but Mubadala can make its claims in regular arbitration proceedings, the insolvency administrator said.

Mubadala declined to comment.