BERLIN — German retailer Woolworth Deutschland GmbH & Co. KG confirmed Tuesday it filed for bankruptcy over Easter weekend.
This story first appeared in the April 15, 2009 issue of WWD. Subscribe Today.
Founded in 1926 and separated from the American parent company in 1998, Woolworth Germany operates 330 stores in Germany and Austria and employs around 11,000. The British financial investment firm Argyll Partners took over the challenged retail chain from Electra Private Equity in late 2007. As part of that deal, Cerberus Capital Management LP bought and leased back around 100 Woolworth properties.
The most recent Woolworth chief executive officer, former Lidl supermarket chain manager Stefan Rohrer, resigned his post at the beginning of April after only four weeks on the job. While his predecessor Robert Brech said Woolworth could be back in the black this year, sales figures are not available for the shortened fiscal year of 2008 that ended last Sept. 30. According to industry sources, 2007 net sales reached 730 million euros, or $1 billion at an average exchange rate for the year, representing a decline of 8.4 percent.
The bankruptcy of Woolworth Deutschland marks the second time in recent months a retailer bearing the iconic name has hit financial difficulty. In November, Woolworth Group plc in the U.K., which had no relation to the German chain, filed for administration, and all 807 of its remaining stores were subsequently closed in January.
In the U.S., the Woolworth name has been out of use for a dozen years. F.W. Woolworth Co. closed its Woolco division in 1983 and its Woolworth variety stores in 1997. Most of its Canadian operations were sold to Wal-Mart Stores Inc., which, also in 1997, replaced it as one of the component stocks on the Dow Jones Industrial Average.
That same year, the company, by this time focused on athletic footwear and apparel through its Foot Locker division, changed its name to Venator. It would become Foot Locker Inc. in 2001.