FRANKFURT, July 10 German DIY retailer Praktiker
, struggling since a strategy of offering big discounts
led to losses, is in talks to find financing to pay suppliers,
several people close to the matter said.
Two people close to Praktiker's supervisory board said the
company was still talking to one bank. Talks with current
creditors over an injection of 30-35 million euros ($38-45
million) had ended without agreement, three people close to the
Praktiker, which runs 430 shops in nine countries, has been
trying to improve its fortunes with store refurbishments after
big discounts to entice customers led to losses. A cold, wet
European spring compounded its difficulties.
"It's difficult. Very, very difficult," a supervisory board
member said following a board meeting on Wednesday.
A spokesman for Praktiker declined to comment on the
company's financial situation. He said that the board was
meeting on Wednesday but declined to say which topics were being
Praktiker's management was prompted to seek new funding
after a credit insurer withdrew coverage to some of its
suppliers this week, according to two people close to the
Credit insurers protecting suppliers against losses if a
company fails to pay its bills. The loss of cover could mean
suppliers insisting on quicker or even upfront payment for
One of Praktiker's biggest creditors is Commerzbank
, which declined to comment on the matter.
($1 = 0.7821 euros)
(Reporting by Alexander Huebner, Matthias Inverardi and
Jonathan Gould; Writing by Victoria Bryan and Maria Sheahan;
Editing by Matthew Tostevin)