Emirati Mubadala Wins €700 Million in Signa Proceedings in Geneva
A bombshell has been dropped in the billion-dollar legal battle over René Benko's collapsed empire. The International Court of Arbitration (ICC) in Geneva has awarded the Abu Dhabi sovereign wealth fund Mubadala over €700 million. While the core real estate companies can breathe a sigh of relief, a foundation belonging to the Benko family is now under enormous pressure.
A working trip of former Chancellor Sebastian Kurz (m.l.) in the United Arab Emirates with Rene Benko (l.) and with Crown Prince Mohammed bin Zayed Al Nahyan (center right). / Picture: © Bundeskanzleramt (BKA) / Dragan Tatic
The ICC ruling stands as a decisive milestone in investigating Europe's largest real estate bankruptcy. Mubadala, the sovereign wealth fund closely linked to Signa after Benko's 2018 trip with former Chancellor Kurz, filed a lawsuit when Signa breached financing agreements, and Austrian insolvency administrators challenged their claims.
The winners and losers of the arbitration ruling
Despite the enormous sum of €703 million awarded to Mubadala according to the creditor protection association Creditreform, the outcome for the various Signa branches varies greatly.
Firstly, Signa Prime & Development, the group's two most important real estate pillars, do not have to make any payments. Administrators Andrea Fruhstorfer (Development) and Norbert Abel (Prime) expressed their relief. Since the claims against these companies were dismissed, the potential quota for the remaining creditors increases.
René Benko personally, the arbitration court declared itself incompetent to rule on the case of the Signa founder, who is currently in pre-trial detention. His lawyer considered this a complete success.
The Laura Private Foundation is now at the center of the storm. Since the foundation—unlike many other parts of Signa—is not yet insolvent, the enforceable title of the arbitration court could take effect directly here. However, experts doubt whether the foundation's assets are sufficient to cover the hundreds of millions of euros.
No preferential treatment for Abu Dhabi
A crucial point for the other creditors: the €700 million was not classified as a “mass claim” (which would have to be serviced first), but as a “simple insolvency claim.” This means that Mubadala has to take a back seat and will only receive the percentage share that remains for all creditors at the end of the proceedings. The danger of immediate “insolvency” – i.e., that there will be no money left for the costs of the proceedings – is thus considered to have been averted for the time being.
Background to the business relationship
The relationship between the desert state and the Tyrolean investor began spectacularly in 2018. Under the aegis of the politicians at the time, the course was set for investments that are now costing Mubadala dearly. Following the collapse at the end of 2023, the fund is now trying to salvage what it can.