Lenders give Steinhoff ex-CEO more time to pay his debts

JOHANNESBURG: Banks granted Steinhoff International Holdings NV’s former chief executive officer, Markus Jooste, another extension to pay back his debt as the global retailer that he headed struggles to survive an accounting scandal that happened under his watch.

Jooste’s personal investment company, Mayfair Holdings Pty Ltd, struck a deal with banks in March this year to sell assets of more than US$2bil to repay debt owed to the lenders by December. Lenders and other creditors have now agreed that Jooste, 57, has until March 31, 2019, to repay his debts, Stefan Potgieter, Mayfair’s sole director, told some stakeholders in an email seen by Bloomberg. Potgieter confirmed the extension.

“We continue to enjoy the support of our creditors for an orderly process in the interest of all stakeholders, which might include further postponements of deadlines, if needs be,” wrote Potgieter, who is also Jooste’s son-in-law.

Mayfair’s biggest asset is candymaker Lodestone Brands Pty Ltd. The founders of the company, whose brands include Rascals candies and Champion toffees, remain minority shareholders and are considering making an offer to buy back the business, said a source.

Such an offer would cover the 959 million rand (US$67mil) in debt owed to Mayfair’s three main lenders – Sanlam Ltd, Investec Plc and Absa Group Ltd, according to the source, declining to say how much the minorities would propose paying.

After Steinhoff shares crashed when it reported a hole in its accounts in December, Mayfair defaulted on its share-backed loans. That gave banks an option to liquidate the company or come up with a breakup proposal to release capital. While the three lenders agreed that the latter course would realise more value, there have been no significant disposals to date and the three banks continue to hold the debt on their books. Mayfair was also involved in horse racing.

“Any suggestion that we are not dealing with the matter in the usual manner by, for example, being unduly lenient to Mayfair is inaccurate,” said an Absa spokesman. — Bloomberg