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Galeria Kaufhof tightens outlet portfolio

12.03.2009

Galeria Kaufhof tightens outlet portfolio

Galeria Kaufhof is not going to renew the leases at its Krefeld, Ostwall, Leipzig-Paunsdorf, Ludwigshafen and Mülheim/Ruhr locations when they expire in 2010. Four outlets – Coburg, Gießen, Wesel and Worms – are currently being evaluated. A final decision is due here in summer 2009.

The company has been pursuing the profiling strategy of Galeria Kaufhof as a distinctive and strong Lifestyle Brand of inner-city retailing consistently and successfully since 2005. "The decision to let these outlets go was taken after careful analysis. Market conditions and the environment at these locations have changed. There is no long-term potential for profitability at these four outlets", says Lovro Mandac, Chairman of the Management Board of Galeria Kaufhof, on Thursday in Cologne.

Over the years, Galeria Kaufhof has developed specific locations with potential for growth. Alongside complete store facelifts, key elements of the new Galeria-Generation were incorporated in other outlets. Giving up outlets which do not meet the business and strategic requirements for long-term profitability is unavoidable, in order to further strengthen the company and optimize its future market position.

The company is soon set to begin talks with employee representatives of the four outlets. "We felt it was important to inform those concerned directly as soon as the decision was taken. We will now work together to find socially acceptable solutions for the personnel at these outlets", stressed Mandac. The outlets will close in the second half of 2010. A total of 301 people are employed in the four outlets.

METRO Group's Galeria Kaufhof, with head offices in Cologne, is one of Europe's leading department stores. With their innovative and successful Galeria concept, the company has come to represent modern lifestyle. Galeria Kaufhof employs 25,000 people in 141 outlets across Germany and Belgium with sales of € 3.5 billion.

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