Steinhoff allowed a breather in Britain
Embattled global retailer Steinhoff International’s path has been cleared to implement a process in the UK that will provide it with breathing space to restructure its balance sheet, which is laden with €9.4bn (about R153bn) in debt.
Steinhoff’s attempt to implement a company voluntary arrangement (CVA) in the UK as part of a bid to get its global operations back on track has been stymied since January by opposition from LSW GMBH, a group understood to have links to its former partner Andreas Seifert. On January 10, LSW challenged the CVA on the grounds of an alleged debt of about £291.4m it was owed by Steinhoff Europe.
CVAs are used in terms of UK law by financially distressed businesses to come to an agreement with unsecured creditors and are often able to secure more favourable rental agreements. Steinhoff’s CVA would freeze debt repayments for three years.
Steinhoff International will
now be able to go ahead with the CVA having reached a settlement with LSW, it announced on Friday. It has also extended the deadline for the closing of its restructuring arrangement to May 31 2019.
The hostilities between Seifert and Steinhoff are believed to date back to Seifert’s sale of half of his German furniture chain POCO to Steinhoff. LSW is understood to be an entity related to Seifert and has had a dispute in Austrian courts against Steinhoff Europe since 2015.
During a parliamentary hearing in 2018, into arguably SA’s biggest corporate scandal, former Steinhoff CEO Markus Jooste blamed the collapse of the group on a campaign launched by Seifert. Jooste told MPs Seifert had tried to use the German tax authorities, regulators and media to influence the outcome of a legal Financial Sector Conduct Authority battle launched in 2015 over the valuation (FSCA) said last week Steinhoff had and ownership of POCO. agreed to furnish all relevant documents
The high-profile battle attracted contained in the PwC forensic the attention of Steinhoff’s auditors, report to help it with its investigation. Deloitte, who in December 2017 The FSCA has launched a number refused to sign off Steinhoff’s of Steinhoff-related probes into accounts. In April 2018, in a bid to insider trading, market manipulation settle the dispute, Steinhoff agreed to and providing false and misleading sell its half of POCO to Seifert. information.
In a related development the