German do-it-yourself stores Max Bahr have filed for insolvency. The move was made after suppliers of the retail giant, owned by Praktiker AG, lost their insurance coverage.
Through the filing, Max Bahr joins its parent in bankruptcy court. Earlier this month we told you about the insolvency filing of Praktiker and eight of its operating companies. At that time, the company stated that its Max Bahr chain wouldn’t be affected by the insolvency move.
Praktiker acquired Max Bar in 2007. Through its brands, Praktiker and Max Bahr, the company serves the construction, renovation, home repairs, home improvement, gardening and leisure markets.
Creditors in that bankruptcy refused to approve a debt reorganization after the retailer failed to sell a stake in a Luxembourg unit. Bloomberg references individuals familiar with the matter as telling them that credit insurers pulled their support during restructuring talks saying they have lost confidence in the ability of company management to turn Praktiker around.
Private-equity company Apollo Global Management LLC also reportedly considered offering credit to Praktiker. Ultimately, it, too, decided against the move, determining it wasn’t a viable decision because the retailer’s creditors declined to give up their collateral.