Bavaria considers financial backing for insolvent Weltbild bookseller
FRANKFURT (Reuters) - The German state of Bavaria may offer insolvent bookseller Weltbild financial backing to try to avert thousands of job losses, a newspaper cited Bavarian state premier Horst Seehofer as saying.
There are a number of options ranging "from debt guarantees to bridge financing", the Sueddeutsche Zeitung quoted Seehofer as saying on Monday.
Weltbild, owned by the Roman Catholic Church and which has 6,300 employees, filed for insolvency on Friday after failing to keep up with competition from Internet-savvy rivals such as Amazon.com (AMZN.O: Quote) and to obtain new financing.
The owners of Weltbild - 12 Catholic dioceses, the Association of German Dioceses and the church's soldiers' welfare organization - have long fought over company strategy.
Two years ago, they decided to prepare a sale of the for-profit business after accusations that Weltbild was making profits from selling erotic books, but no deal materialized.
Labor representatives have criticized the Church for allowing Weltbild to become insolvent, putting jobs at risk.
The Church says it has no choice and has offered financing, which Sueddeutsche Zeitung said was 65 million euros ($88.87 million), less than half the 135 million Weltbild has demanded.
"As owners we could not justify investing three-digit million euro sums, taken from church tax revenue, for the foreseeable future," Reinhard Marx, archbishop of Munich, told Sueddeutsche.
Weltbild, which relies on sales from catalogues and is part-owner of Germany's second biggest brick-and-mortar bookstore chain Hugendubel, said its business will continue while the court-appointed insolvency administrator works out a plan to restructure the business. Continued...