Essen Court To Decide On Extension Of Karstadt Sale Talks

An Essen court will decide Tuesday if it will grant another extension for billionaire investor Nicholas Berggruen and creditors of retailer Karstadt to continue sales negotiations for the insolvent German department store chain, a spokesman for Karstadt's insolvency administrator said Sunday.

Berggruen and Karstadt's creditors are unlikely to reach an agreement on Berggruen's takeover plan for Karstadt before a midnight Sunday deadline to sign a contract, spokesmen for the insolvency administrator and Berggruen's holding company said Sunday.

Berggruen won a bid to acquire Karstadt earlier this year if it could reach an agreement with the retailer's creditors on issues including lower rents and lease agreements. The sales process was already extended several times in recent months, first as its insolvency administrator struggled to attract bidders and more recently as Berggruen and Karstadt's creditor's haggled over details in his takeover plan.

The iconic German retailer employs more than 25,000 around Germany and risks being shuttered by insolvency proceedings.

-By William Launder; Dow Jones Newswires; [phone]; [e-mail]