TIROLER TAGESZEITUNG, editorial: “Light into the dark Signa Empire”, by Max Strozzi

Issue from Thursday, November 30, 2023

Innsbruck (OTS) – There is still a lot that needs to be dealt with surrounding the historic bankruptcy of René Benko’s Signa Holding, such as its involvement with politics or the role of the owners and financiers. It will be interesting to see what else comes to light.

It’s so easy to find yourself sidelined as the nation’s favorite. A few years ago, René Benko was allowed to jet with ex-ÖVP Chancellor Sebastian Kurz to various oil sheikhs as part of his entourage. The red carpet was also rolled out for him to take over the Kika/Leiner Group. In Germany, the alleged savior of the Karstadt/Kaufhof chain was initially embraced, but rescue largely failed to materialize. Now that the plaster of the Signa Group is crumbling and the view behind the dazzlingly shiny facade of the billion-dollar company is slowly becoming clear, people are distancing themselves. He sees no political issue, said ÖVP Chancellor Karl Nehammer regarding yesterday’s insolvency application by the Signa umbrella company, it’s all just a case for the insolvency judge. That’s just how it is in economic life, sometimes it goes up, then it goes down once more. And the main thing is that not too much happens to the banks, added Green Vice Chancellor Werner Kogler.
In the case of Benko’s Signa empire, the crash was preceded by a rapid rise to become a major player in the European real estate monopoly, accompanied by a lot of skepticism. It was a very risky gamble with cheap money, high property valuations, and very optimistic rental expectations. The whole thing is embedded in an opaque network of hundreds of companies from Innsbruck to Luxembourg, where no one knows what money may have flowed where within the group. Attempts to get an accurate overall picture of Benko’s Signa from the outside have so far been doomed to failure. It will be exciting to see what the bankruptcy court can uncover here.
The insolvency of Signa Holding is the largest bankruptcy in Austrian economic history. There will still be a lot to work through around Signa. The interconnection with political companions – from ex-SPÖ Chancellor and Benko intimate Alfred Gusenbauer to ex-ÖVP Chancellor Sebastian Kurz – as well as the role of the financiers, owners and supervisors who have been at the table for years in the risky real estate game and – unlike what was possible for outsiders – must have been well informed regarding Signa’s business practices and the precarious situation. Who knew what and when? When did the alarm bells ring? Signa isn’t just regarding money from a few super-rich people. A collapse has the potential to leave deep marks not only on bank balance sheets, but also in inner-city cities. And it can drag hundreds of creditors, construction companies and thus thousands of affected employees into the abyss.

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