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© Reuters. FILE PHOTO: The sign of Signa Holding is placed on one of their offices in Vienna, Austria, November 6, 2023. REUTERS/Leonhard Foeger/File Photo
DUESSELDORF (Reuters) -Signa Development Finance, a unit of Signa Development Selection AG, announced on Friday that it is “predominantly likely” that its parent and related companies will be filing for insolvency soon.
Signa Development Selection AG, known for investment in development projects in major urban centers, and other companies within the Signa Development group, are planning to apply for insolvency proceedings in the “very near term”.
Last week, Signa Development Selection AG brought restructuring expert Erhard Grossnigg onto its board.
An insider informed Reuters earlier on Friday that more companies within the Signa group are expected to follow suit and file for insolvency in the near future.
These developments mark a downturn for the company, which has been the biggest casualty of Europe’s property crash so far.
According to the insider, several Signa companies have filed for insolvency in the days since the Signa group holding company filed its own separate application last week. More filings are anticipated in the near future as well.
The insolvency filing by the Vienna-based holding company last week, with debts of around 5 billion euros ($5.4 billion), was a major setback in the conglomerate’s history and highlighted the grim outlook for the broader property sector.
Signa Prime, a crucial division with assets including the Park Hyatt hotel in Vienna and the Elbtower skyscraper in Hamburg, is reportedly preparing to file for self-administered insolvency, as reported by Spiegel news magazine on Friday, citing unnamed sources.
According to the report, the insolvency application is expected within the next two weeks.
A spokesperson for Signa has not yet responded to requests for comment.
($1 = 0.9274 euro)