31.10.2008, Staff cost savings of €115 million by 2011

Essen, October 31, 2008. After two weeks of negotiating, the Management Board, employee representatives and the ver.di union have reached an agreement on the details of the "pact for the future". This way, the company will save €115 million p.a. over the next three years, thereby further strengthening its competitive position.

The "pact for the future" does not include any job cuts. Barring this, there will be some necessary adjustments in some individual companies. Employees will be given the opportunity to participate in the positive economic development of the company. The details of this are still being negotiated.

As part of the pact, members of the Management Board, managers, executives and employees will contribute based on their potential  Employees with an annual salary of €18,000 or less (on a full-time basis) will not have to make a contribution. This also applies to employees who have already made special contributions towards competitiveness as part of the restructuring in the logistics and customer care centers (Primondo Group) in the past year. Employees in the "pact for the future" will be waiving an average of between 7% and 12% of their annual income. The contribution by managers will be 20%, and by members of the Management Board 30% of annual income.

The "pact for the future" covers Karstadt Warenhaus GmbH, which has around 30,000 employees, the Primondo Group (around 10,000 employees) and the several hundred employees of Arcandor Holding including the Corporate Service Group. The parties have prepared individually adjusted solutions that meet the requirements in the individual companies.

The employees participating in the "pact for the future" were informed of the outcome by management today.

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