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Embroiled retailer Steinhoff has raised R7.3bn through an accelerated bookbuild in subsidiary Pepkor, which the cash-strapped business will distribute to claimants as part of the ongoing global settlement process. Steinhoff has increased its offer to claimants to approximately R25bn (from around R17bn), which has received support from many institutional investors and lenders. However, Steinhoff are facing a separate liquidation bid from the owners of Tekkie Town, which continues in court today. The threat of liquidation will essentially determine the future of the global retailer and its ability to continue as a going concern. Despite a number of solid, well performing assets within the Steinhoff stable, the fire-sell scenario in a liquidation event would mean that the proceeds of its assets would not be able to cover the mountain of debt owed by the company. – Justin Rowe-Roberts
Steinhoff SENS statement:
Launch of placing of up to 370 million shares in Pepkor
Shareholders of Steinhoff International Holdings N.V. (“Steinhoff”, the “Company” and with its subsidiaries, the “Group”) are referred to the previous communications regarding the Group’s proposed settlement of the global litigation (“Proposal”), as well as the announcements regarding the successful outcome of the meetings convened by Steinhoff International Holdings Proprietary Limited (“SIHPL”) in terms of section 155(6) of the Companies Act 71 of 2008, as amended, for purposes of voting on the Proposal made by SIHPL to its scheme creditors in South Africa, and the meeting of the committee of representation convened under Steinhoff’s Dutch composition plan for the purposes of voting on the Proposal made by Steinhoff to its scheme creditors in the Netherlands.
Further information regarding the Proposal is available at www.SteinhoffSettlement.com.
In order to assist in the funding of the settlement of the creditors embodied in the Proposal, Steinhoff has decided to launch an accelerated bookbuild of up to 370 million ordinary shares of no par value in Pepkor Holdings Limited (“Pepkor”) (“Placing Shares”) (the “Placing”), representing approximately 9.9% of the current issued shares, subject to acceptable pricing being achieved.
Steinhoff, through an indirect wholly owned subsidiary, currently owns 68.2% of the issued shares in Pepkor. As provided for in the Proposal, certain SIHPL section 155 contractual claimants and / or market purchase claimants elected, by 8 September 2021, to receive their Second Settlement Portion in shares (“Election PPH Shares”). The total Election PPH Shares amounted to approximately 300 million shares which will be distributed to those claimants at the closing of the global settlement process. These shares will be subject to a 180-day lock-up commencing from the date of transfer, which is expected to coincide with the closing of the global settlement process.
On successful conclusion of the Placing, assuming Steinhoff places all of the Placing Shares, and following distribution of the Election PPH Shares subject to the election, Steinhoff will retain ownership of approximately 50.1% of the issued shares in Pepkor. Assuming Steinhoff places all of the Placing Shares, the Placing will also increase the free float of Pepkor from approximately 31.8% to 41.7%, before giving effect to the distribution of the Election PPH shares.
Steinhoff continues to view Pepkor as a strategic investment for the Group, but will conclude the Placing in line with the objective of facilitating the implementation of the Proposal. In line with Steinhoff’s intention to retain the remaining interest in Pepkor, Steinhoff has agreed to a 180-day lock-up period, except in the case of any Pepkor shares delivered after the date of this announcement to claimants that were not eligible for the Proposal, provided that any Pepkor shares received by such claimants will be subject to a 180-day lock-up beginning from the day such Pepkor shares are received.
Information relating to the Placing
The Placing is offered to qualifying investors only (as set out in greater details in the disclaimer below) and does not and will not constitute, nor is it intended to constitute, an offer to the public to purchase any shares in any jurisdiction.
The Placing will be carried out by Goldman Sachs International and Investec Bank Limited (together, the “Managers”) who are acting as joint bookrunners in respect of the Placing, pursuant to the terms of the agreement entered into between the indirect wholly owned subsidiary of the Company which owns shares in Pepkor and the Managers.
The book will open with immediate effect and is expected to close as soon as possible, at the discretion of Steinhoff. Pricing and allocations will be announced as soon as practicable following the closing of the book.
Information relating to Pepkor
Information on Pepkor, including its most recent annual report, interim financial results and investor presentation, can be found on its website https://www.pepkor.co.za/. It should be noted that Steinhoff bears no responsibility for any information included on Pepkor’s website.
The Company has a primary listing on the Frankfurt Stock Exchange and a secondary listing on the JSE Limited.
- The Great Steinhoff settlement debate – Piet Viljoen and Bernard Mostert
- ‘The Tekkie Town owners were greedy enough to take Steinhoff shares instead of cash’ – Piet Viljoen
- ‘We continue to fight for what’s right and we trust the system’ – Bernard Mostert on the Steinhoff settlement saga
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