Sal Oppenheim hits back at Arcandor claims

German private bank Sal. Oppenheim, Arcandor's largest shareholder, on Friday dismissed as "groundless" the accusation that it no longer supported the planned restructuring of the insolvent German retail group.

The bank said it remained "interested in a sustainable solution" to Arcandor's problems, but that the bank's partners had made new funds dependent upon a "workable restructuring plan," which the company had not yet tabled.

Arcandor's chief restructuring adviser, Horst Piepenburg, quit late Thursday, accusing Sal. Oppenheim, which owns 24.9 per cent of the retailer, of providing "no support" for the group's efforts to re-emerge from insolvency.

The long-floundering company, which owns Karstadt department stores, Primondo mail-order and 53 per cent of UK travel group Thomas Cook, filed for bankruptcy in early June after it failed to secure a state loan guarantee.

Karl-Gerhard Eick, chief executive, immediately hired Mr Piepenburg, one of Germany's foremost insolvency experts, to help management restructure the company and steer it out of bankruptcy proceedings in one piece.

But doubts about Sal. Oppenheim's willingness to support this course emerged last month when the bank sold a 3.7 per cent stake in Arcandor and said its partners would decide what to do with the remaining shares this summer.

Sal. Oppenheim was instrumental in propping up an already-tottering Arcandor in the run-up to Christmas 2008, when the Cologne-based bank provided a capital injection that made it the retail company's largest shareholder.

It then sought a new chief executive for Arcandor, replacing Thomas Middelhoff with Mr Eick, who had made a name for himself as a financial-restructuring expert while finance chief of telephone group Deutsche Telekom.

Mr Eick late on Thursday tried to play down the importance of Mr Piepenburg's departure, saying he would "continue to use every opportunity offered to win the support of investors for our restructuring plan until mid-August."

Mr Eick in effect has until September to table a restructuring plan. From the beginning of that month creditors have the right to petition the insolvency court to start liquidating the company rather than restructuring it.

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