Banks agree to merger of HBC's Kaufhof and Karstadt

DUESSELDORF/BERLIN: Creditors of Hudson's Bay have agreed to a merger of the Canadian retailer's German department store chain Kaufhof with rival Karstadt, owned by Austria's Signa Holding, German daily Sueddeutsche Zeitung reported, citing no sources.

The merger would result in around 5,000 of the 20,000 jobs at Kaufhof being cut, the paper said, adding that the remaining employees would face pay cuts.

Signa was not immediately available for comment. A spokesman for HBC referred to the company's previous statements. HBC had confirmed in July that it was in talks with Signa over a potential joint venture for its European business.