Steinhoff raises R3.75bn from sale of African unit

Steinhoff International raised R3.75 billion from the sale of shares in the embattled retailer’s African operations, to further shore up its balance sheet following an accounting scandal late last year.

The move follows similar disposals of stock in KAP Industrial and investment holdings company PSG Group and brings the total generated from the three South African companies to about $1.6 billion.

The fundraising initiatives are enabling Steinhoff to buy time from creditors, as the company struggles to recover from a 95% stock-price crash.

The owner of Conforama in France and Poundland in the UK sold 200 million shares in Steinhoff Africa Retail (Star), reducing its stake to about 71%, it said yesterday.

The settlement price was R18.75 a share – a 2.6% discount to Star’s closing price in Johannesburg yesterday. Steinhoff spun off the unit last year, and the operation has been largely protected from the crisis that’s engulfed its erstwhile parent.

Steinhoff said on December 5 that it had uncovered accounting irregularities and that CEO Markus Jooste had quit. PwC is investigating the accounts, with a focus on off-balance-sheet transactions related to central Europe operations. The company is being probed by a host of regulators and law authorities around the world. – Bloomberg