Pepco’s German subsidiary placed under bankruptcy protection

By: Trademagazin Date: 2025. 07. 28. 11:36

Pepco’s German division has filed for insolvency, despite the retail group reporting a 7.7% year-on-year increase in third-quarter revenue. The company plans to restructure its 64-store network in Germany, potentially resulting in store closures – reports Economix.

Revenue Growth Amid Insolvency Filing

The insolvency announcement from Pepco Germany comes as a surprise, given that the Pepco Group reported €1.1 billion in revenue in Q3 2025 – a 7.7% increase compared to the previous year. However, the company cited intense competition in the non-food retail sector as the reason for needing to rethink its strategy on the German market.

On July 21, 2025, Pepco Germany filed for protective shield proceedings (Schutzschirmverfahren) with the District Court of Berlin-Charlottenburg. This German legal mechanism allows the company to remain under its own management while an interim administrator is appointed to protect creditors’ interests. The entire restructuring process is being financed by the Pepco Group’s shareholders.

Store Closures Likely, But No List Yet

Although the company has not yet specified which of the 64 stores may be closed, the network currently includes locations in Berlin, Magdeburg, Leipzig, and across the Rhine-Ruhr area, employing approximately 500 staff. Pepco emphasized that all affected stores remain open for now and continue to offer the latest collections as usual.

Not the First Exit in the Region

Pepco previously exited the Austrian market in 2024. This latest move, however, pertains exclusively to its German operations. The company made no reference to its Hungarian presence in the announcement, indicating that the 266 stores in Hungary are not impacted by the German restructuring.

Optimism Despite Market Challenges

Despite the insolvency filing, Pepco remains confident about its future prospects in Germany. The goal is to build a leaner and more agile structure that can better respond to market challenges. For consumers, this means continued access to Pepco’s value-driven product range even during the restructuring period.