• Arcandor meets EU criteria for state support
• Group has major economic significance with 86,000 employees
• Business relations with 20,000 suppliers and service providers in Germany
• Very important in regional politics and shopping magnet in 90 city centres
• Talks with politicians progressing constructively

Essen, May 15, 2009.  As part of its upcoming Group financing, Arcandor AG is also banking on state guarantees of 650 mill. € from the Germany Fund launched by the German Federal Government. The application for the guarantees via its home banks is intended for the end of next week. The Company is also applying for a loan from the Kreditanstalt für Wiederaufbau (KfW) from a special programme launched for that purpose.

Dr. Karl-Gerhard Eick, Chairman of the Arcandor AG Management Board, remarked: “We do not want a handout, nor do we want the state to become a shareholder in Arcandor or other special financial support. We are seeking a state guarantee to temporarily bridge the gap of the currently non-functioning financial markets. It is almost impossible for us, as it is for many other companies, to obtain new loans or extend existing ones. The state guarantee programme is there to bridge this gap. We also intend to obtain a loan at market conditions from the KfW from a programme that is especially designed for companies in our situation: restructuring in difficult situations. We will pay back this loan to the last penny.”

Arcandor AG fulfils the strong criteria for state support laid down in the “European Union Guidelines on State Aid for Rescuing and Restructuring Firms in Difficulty”. The Company was neither insolvent nor overindebted before the reference date of 1 July 2008 and the time period of two years before.

Chief Financial Officer Rüdiger A. Günther stated: “Neither banks nor business partners have lost even a cent on us to date. Before the economic and financial crisis, the Company was always able to manage its business operations and its realignment on its own power. However, the financial crisis made it difficult for us to gain access to new loans or to extend existing ones. This is why we are applying for the state guarantee.”

Another key factor for the authorisation of the guarantee is the economic importance of the Company. With its Karstadt und Quelle trading segments, Arcandor is an integral part of the German supply structure and important in both economic and socio-political terms. The Company employs 86,000 staff, 53,000 of whom in work in Germany. It also employs 2,000 trainees. In Germany alone, Arcandor maintains business relations with approximately 20,000 service providers and suppliers. Karstadt ensures brisk retail trade in over 90 city centres in Germany, while Quelle continues to supply rural areas of Germany with its mail-order service.

Preparations with the bank for the guarantee application are well advanced and will be completed shortly. Talks with political decision makers in Berlin, Düsseldorf and Munich are currently proceeding in a very constructive manner.

Press contact:

Arcandor AG
Corporate Communications
Gerd Koslowski
Telephone: +49 (0)201 727 25 38
gerd.koslowski@arcandor.com