Austrian real estate tycoon Rene Benko was stripped of his power and had to give up the shares in his severely ailing SIGNA, one the largest European real-estate groups. The equation of rising interest rates plus more restrictive lending with a high level of debt could no longer be solved. Like China’s Evergrande, SIGNA relied on cheap credit and constantly rising real-estate prices. But these times have gone for good!
SIGNA Walks The Evergrande Path
Since around 2010, after the financial crisis triggered by the collapse of Lehman Brothers in 2008 was halfway digested, the real estate sector has been booming. It was the time of Xu Jiayin a/k/a Hui Ka Yan and his Evergrande and of Rene Benko and his SIGNA.
Evergrande had to file for bankruptcy in the US in August 2023 because it could no longer service its debts. SIGNA seems to be facing a similar fate Its investors and creditors are panicking. The company needs fresh money but nobody wanted to invest as long as founder Rene Benko was in control. According to reports in the Austrian news outlet Krone, he has lost this control today.
Allegedly, Benko has handed over the voting rights of his SIGNA shares to the hired restructuring expert. It is doubtful whether this step is enough to avert bankruptcy for SIGNA. Instead, a break-up and further bankruptcies in the SIGNA Group are to be expected.
Rene Benko: About Being A Real-Estate Tycoon
he has acquired the $45 million yacht “Roma” and briefly put in the Chrysler Tower in Manhattan or a palazzo in Venice. Other prestigious properties and an IPO of Signa Sports United (SSU) in New York, which has now slipped into bankruptcy, happened in passing. Dear Rene was courted as a genius. He is said to have had a net worth of around €5.5 billion.
The Evergrande founder was also once the second richest person in China. Once upon a time, history will tell the tale. Now, Hui Ka Yan is being investigated by the authorities for suspected criminal behavior.
As with the Evergrande founder, we will probably soon be able to read further accusations against Benko. Criminal investigations are already underway against him. Such company collapses rarely end well for the founders. We recently saw this with the bankrupt crypto exchange FTX, where founder Sam Bankman-Fried was convicted of fraud and money laundering.
Share Information
If you have any information about Rene Benko and his SIGNA Group, please let us know via our whistleblower system Whistle42.
