Karstadt CEO quits
June 10, 2013
Karstadt Chief Executive Andrew Jennings would not prolong his contract, which was going to expire at the end of 2013, the German department store chain announced Sunday.
In a statement, the Essen-based company denied a report in Germany's mass-circulation "Bild" that the resignation was the result of differences between Jennings and Karstadt owner and billionaire investor Nicolas Berggruen.
Dismissing reports that the two had clashed as incorrect, the company said that Berggruen and the Karstadt management had a harmonious understanding on the continuation of the Karstadt strategy.
After the collapse of German retail and tourism conglomerate Arcandor in 2010, Berggruen took over the heavily indebted Karstadt department stores, saving more than 25,000 jobs in Germany.
In 2011, Berggruen hired Andrew Jennings as CEO - a British national who had previously headed Woolworths in South Africa.
In 2012, Jennings launched a major restructuring program called "Karstadt 2015," envisaging modernizations, the expansion of the company's online business as well as about 2,000 job cuts.
In addition, Jennings also announced that Karstadt intended to freeze wages for an indefinite period to become profitable again - a move which draw hefty protest from worker representatives and trade unions.
At the weekend, Bild newspaper also reported that Karstadt stocks were held by Nicolas Berggruen Charitable Trust, a holding company situated on Virgin Islands. The British overseas territory is known to be a so-called tax haven, helping corporations from around the world to avoid paying taxes in their home countries.
A spokeswoman for Berggruen said he did not profit personally from the trust.
uhe/ipj (dpa, AFP)