Austrian tycoon Hans-Peter Haselsteiner said he is ready to contribute as much as 25 million euros (S$36.45 million) to Signa group’s insolvent development unit to allow a more orderly restructuring.

The billionaire founder of the Strabag construction company, who is a 9.2 per cent shareholder in Signa Development Selection, said the funds would allow the insolvency administrator and management to continue a disciplined restructuring.

“It’s about minimising damage and not about bailing out the company,” he said in an interview with Austrian public broadcaster ORF late Wednesday (Jan 24). “I have said I am ready to contribute because as a shareholder I feel responsibility.”

The pledge is the first capital injection into Rene Benko’s sprawling property and retail empire since financial strains first emerged in October. A large part of the conglomerate – which valued its real estate at more than €23 billion at the end of 2022 – is now insolvent.

The loan will be senior to all other amounts owed by Signa and won’t be subject to any write-downs as part of Signa’s insolvency proceedings, which began last year. Any contribution will still have to be approved by a majority of creditors at a meeting scheduled for March.

Haselsteiner said he won’t contribute funds to Signa’s larger, Prime unit, which owns luxury assets including stakes in London’s Selfridges department store chain and the Hotel Bauer in Venice. 

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Despite his “bitter defeat” as a shareholder, the tycoon said creditors should be able recoup investments if Signa’s insolvency administrator has access to cash needed for an orderly wind down. 

“The victims are actually the shareholders,” Haselsteiner said. “The creditors are manageable. I believe the creditors will have to accept very modest losses.” BLOOMBERG