Pound­land ex-owner of­fers in­vestors $1bn to end fraud dis­pute

The Daily Telegraph - Business - - Business - By LaToya Hard­ing

FOR­MER Pound­land owner Stein­hoff In­ter­na­tional Hold­ings has of­fered to pay in­vestors $1bn (£780m) in or­der to end a long-run­ning fraud scan­dal.

The pro­posed set­tle­ment aims to re­solve more than $8bn of le­gal claims lodged against the re­tailer af­ter an ac­count­ing scan­dal nearly wiped out the South African con­glom­er­ate in 2017.

Claimants would re­ceive a com­bi­na­tion of cash and shares in Pep­kor Hold­ings, a cloth­ing re­tailer con­trolled by Stein­hoff, with most of the 90 out­stand­ing claims in­cluded in the deal.

The pro­posal is the cul­mi­na­tion of 12 months of “in­ten­sive ef­fort”, the com­pany said, and would mit­i­gate the steep le­gal fees Stein­hoff has in­curred since ac­count­ing ir­reg­u­lar­i­ties were un­cov­ered. Th­ese in­cluded ev­i­dence that for­mer ex­ec­u­tives in­flated prof­its and as­sets by more than $6bn for sev­eral years.

Louis du Preez, chief ex­ec­u­tive, said in a state­ment: “Although there is no cer­tainty yet that we will be able to con­clude this set­tle­ment, in our view th­ese terms are firmly in the best in­ter­ests of all stake­hold­ers.”

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