Pepco goes bankrupt with SSP

642 employees and approximately 300 creditors were affected. The company has 73 branches in Austria. The KSV1870 Creditor Protection Association estimates liabilities at approximately €53 million, of which approximately €46 million result from anticipated termination or damage claims, which will become particularly important in the context of bankruptcy proceedings due to termination of service and existing relationships. According to the agency, the estimated liabilities amount to about 72 million euros, the majority of which (65 million) are directed against subsidiaries. It will therefore be necessary to examine whether inter-group liabilities – receivables worth $44 million and loans granted worth $21 million – should be viewed as equity. The two creditor protection associations agree to calculate the liquidation value at approximately 11.6 million euros.

The company cites high inflation rates, high operating costs as well as cautious consumer behavior as the main reasons for the bankruptcy. According to the debtor, business activities in Austria will be stopped. For the time being, branches should remain open to enable the sale of goods. Only then might the insolvency court have to close down the debtor company, said a spokesman for the Creditor Protection Association KSV1870.

Grocers Lidl and Rewe (Billa, Billa Plus, Bipa and Penny) are looking for employees throughout Austria and have expressed interest in Pepco employees.

A short piece of music

Pepco entered Austria only two and a half years ago, when the majority of the stores of the footwear retail chain CCC were taken over. The company offers, among other things, clothing, toys, household goods and furniture at low prices.

Founded in 2015, the Bibco Group is headquartered in Poznań and has been listed on the Warsaw Stock Exchange since 2021. According to its own data, the group operates more than 4,800 branches and employs more than 46,000 employees in 21 countries. Internationally, the group of companies recorded record sales numbers in the fiscal year 2022/2023. Sales rose by more than 17 percent to €5.65 billion as a result of several new openings. However, net profit fell by 41 percent to €102 million.

Guardian
Schmidt-Birker Budochek (Vienna): Dr. Matthias Schmidt (Insolvency Administrator), Christian Budoček (Deputy Insolvency Administrator), Matthias Stepanitz (Insolvency Law), Erland Berker (Real Estate Law); Associate: Stephanie Rendell (Employment Law, Trainee Solicitor)

Debtor's representative
Gopher (Graz): Dr. Mario Licentrit (leader), Dr. Clemens Joffre (both in insolvency law), Alexandre Bensi (insolvency law, cross-border issues), Dr. Franziska Jover (labor law); Assistant: Nina Lorf (insolvency law; trainee lawyer)

background: SPP partner Schmidt has long been one of Austria's best-known insolvency lawyers. In 2022, the team around him, Christian Budoček and Erland Berker, parted ways with the Vienna law firm Preiselmeier. In the event of Pepco's bankruptcy, Schmidt, along with rising Stipanitz, would handle continuing operations and all strategic matters in liquidation. Perker takes care of inventory and real estate. The intern is responsible for employment law matters.

Gover Law Firm, known for its strength in insolvency law, was appointed to act on behalf of the debtor following a recommendation. The team is currently under the leadership of well-known partner Dr. Clemens Joffre also represented Signa Holding in insolvency proceedings. The younger Lescentrit also made a name for himself in insolvency law. Before founding the law firm in 2020, they both worked at Scherbaum Seebacher, which has long been one of the leading units in Styria.