Germany

Bondholders who own the debt of insolvent German retailer Karstadt's properties have called another special meeting in London on Sept. 2 to discuss some of the terms of billionaire investor Nicholas Berggruen's takeover offer, according to a notice from the group reviewed by Dow Jones. The bondholder group, which represents senior class A noteholders in the Fleet Street Finance Two PLC securitization, has called the meeting ahead of an Essen court deadline to reach an agreement with Berggruen over his takeover plan by midnight Sept. 2.

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, Dow Jones reported. Berggruen and Karstadt's creditors were unlikely to reach an agreement on Berggruen's takeover plan for Karstadt before a midnight Sunday deadline to sign a contract.

Borletti Group's new offer to acquire insolvent German retailer Karstadt includes a €100 million investment and wouldn't separate the department chain into several units, as proposed by investor Nicholas Berggruen in June, the Italian group's head, Maurizio Borletti, said Wednesday, Dow Jones Daily Bankruptcy Review reported. Berggruen won a bid to acquire Karstadt in June, but the deal is contingent on reaching agreements on rental and other conditions with Karstadt's creditors. The final agreement has been held up as Berggruen and creditors discuss formal details ahead of an Aug.

Dubai International Capital, the private equity arm of the Gulf Arab emirate, said it will focus on bringing German aluminium maker Almatis out of bankruptcy after a long-running battle with a dissident lender ended, Reuters Africa reported. Oaktree Capital Management LP withdrew its opposition to DIC's plan to retain control of the bankrupt firm after a settlement offer was leaked. Oaktree and Dubai have been battling over the best way to refinance Almatis, which filed for bankruptcy in the United States with more than $1 billion in debt, for the past year.

Oaktree Capital Management LP is willing to give up its fight for control of Almatis BV, a bankrupt aluminum maker, for full payment of its loans and an end to threatened legal action, according to a "confidential" court filing on Monday, Reuters reported. In a letter dated July 27 to an Almatis lawyer, Oaktree's lawyer outlined six conditions for ending Oaktree's battle with Dubai International Capital LLC over the European aluminum company.

Property group Highstreet has agreed to a compromise on rents with insolvent retailer Karstadt, a move which will help investor Nicolas Berggruen rescue the department store operator, according to German daily Bild am Sonntag, Reuters reported. A disagreement on store rents had prevented Berggruen from striking a deal with the highstreet consortium, which consists of Goldman Sachs, Deutsche Bank and Pirelli Real Estate. Highstreet had warned Berggruen that Karstadt, which owns the famous KaDeWe department store in Berlin, could still be liquidated if an accord on rents did not emerge soon.

European regulators have accused Germany and its banks of reneging on a deal to publish full details of sovereign debt holdings, as part of the four-month-long stress test exercise of the country’s banking sector.

The stress test conducted on nationalized German lender Hypo Real Estate uncovered a possible capital shortfall of €2 billion ($2.59 billion) under adverse circumstances, people familiar with the matter said Tuesday, The Wall Street Journal reported. Hypo Real Estate is thus the first bank to appear to fail a test of its soundness conducted by the Committee of European Banking Supervisors, which also is reviewing the health of 90 other major banks. However, analysts said the result is far from surprising and says little about how the overall process will play out.

The representatives of potential Karstadt investor Nicholas Berggruen and Germany's Valovis Bank said Tuesday they have agreed on the conditions for a rental agreement over 53 Karstadt properties, further paving the path for Berggruens takeover of Karstadt following weeks of negotiations, Dow Jones Newswires reported. Now there is agreement on all essential points of the rental contract, Berggruen Holdings and Valovis said.

Germany's economy is growing. Global exports are booming. The euro is recovering. What's not to like? Plenty, according to a survey of German banks. Fully 60 percent fear that the euro crisis will worsen and jeopardize economic growth, Spiegel Online reported. According to the semi-annual "Bank Barometer" survey carried out by Ernst & Young in Germany, which was released on Thursday, only 39 percent of the 120 banks surveyed feel that the situation on the financial markets will improve in the next six months. In December, 65 percent thought it would.