Makro Cash & Carry Belgium submits an application to the company court of Antwerp for a procedure of judicial reorganization (PGR) by transfer under judicial authority. In this way, the retail chain asks for protection against creditors.
The procedure makes it possible to transfer all or part of the activities. The board of directors of Makro Cash & Carry Belgium wants to take this step to protect the company’s viable economic activities, the company said in a statement.
Makro Cash & Carry Belgium has seventeen stores: eleven stores of catering wholesaler Metro and six branches of supermarket chain Makro. In total, about 2,000 people work there. The company, which has been struggling for years, was acquired in June by investor Bronze Properties.
“The financial difficulties facing the company pose a threat to business continuity,” it said in a statement. “The company has so far been able to avert a state of insolvency only through regular and very large capital increases, financed by former shareholder Metro AG.”
Owner Bronze Properties says that the current structure of Makro Cash & Carry Belgium’s business activities, which are organized within one legal entity, is economically unsustainable. In recent months, several parties have shown interest in acquiring the activities of Metro, certain activities of Makro or Makro stores. But no interested party has proposed to take over the company in its entirety, stresses Bronze Properties.
‘The best option’
Makro’s decision “was the best option to save as many jobs as possible.” Vincent Nolf, CEO of Makro Cash & Carry Belgium, stated this.
Nolf says that the current structure, in which eleven stores of catering wholesaler Metro and six branches of supermarket chain Makro are located within the same entity, is too heavy. “That puts the entire company at risk,” especially in combination with the ongoing financial difficulties, says the CEO. ‘We want to keep as many jobs as possible. The split is necessary to make that happen.’
Nolf states that there is not only concrete interest in a takeover of the Metro stores, but that interest has already been shown in parts of Makro. However, no one is interested in taking over the company as a whole.
The CEO cannot completely rule out the possibility that some parts will eventually not find a buyer. ‘In that case, we will have to liquidate the part that is not viable’, says Nolf.
The Antwerp company court has two weeks to approve the petition for judicial reorganization. A concrete date for that decision is not yet known, according to Nolf. If the request is accepted, a judicial officer will be appointed who will manage the next steps for the transfer of activities. The procedure would take about 4 to 6 months.