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German DIY chain faces insolvency, 18,000 jobs at risk

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(Globalpost/GlobalPost)

German home improvement store chain Praktiker said Thursday it had failed to find sufficient financing to continue operating and will now have to consider filing for insolvency, potentially putting 18,000 jobs at risk.

"Negotiations on additional, initially promising, restructuring finance failed on the evening of July 10 because certain creditor groups did not provide approval for such financing," Praktiker said in a statement.

The financing had become necessary after the heavily indebted group failed to complete its planned sale of a stake in Luxembourg-based Batiself.

This meant that "the expected proceeds from the sale could not be realised. These proceeds had been firmly included in the financing concept from 2012," the statement said.

"The management board will now carry out a review ... to determine the units for which insolvency applications will have to be filed and will then publish the results of this review as soon as possible."

On the Frankfurt stock exchange, Praktiker shares nosedived by 69 percent to 0.11 euros.

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http://www.globalpost.com/dispatch/news/afp/130711/german-diy-chain-faces-insolvency-18000-jobs-at-risk