JOHANNESBURG – Scandal-hit Steinhoff said on Wednesday it had refinanced some 9 billion euros ($10 billion) of debt in its overseas operations which include brands such as Poundland in Britain and France’s Conforama, after pushing the deadline date back repeatedly.
“Implementation of the restructuring is a major milestone on our recovery journey, bringing with it the stability that will allow us to turn the page and concentrate fully on maximising value from our operating companies,” Group Chief Executive Louis du Preez said in a statement.
“The company remains committed to improving the performance of its operational businesses across the group, reducing its debt, resolving the legal claims against it and delivering value for its stakeholders.”
Du Preez on Tuesday delivered a stark assessment of Steinhoff’s options at the South African company’s first public investor presentation since a $7 billion accounting fraud scandal broke, saying its only hope for survival is to sell off assets to become a retail-focused holding company.
Shares in Steinhoff jumped 4.84% to 1.30 rand in early trading.
Established more than 50 years ago, the firm expanded from a small South African outfit to a furniture and household goods retailer straddling four continents before it shocked investors by flagging holes in its accounts in Dec. 2017.
Its Steinhoff Europe AG (SEAG) and Steinhoff Finance Holding GmbH (SFHG) operations had entered into a company voluntary arrangement (CVA) with its creditors last year.
A CVA is a UK legal process that allows a company with debt problems to reach a voluntary agreement with creditors over the payment of its debts while continuing to trade.
SEAG’s 5.6 billion euros of debt, plus around 2.8 billion from SFHG and a further 400,000 euros from another business has been reissued with maturities from Dec. 2021 and no cash interest payments.
The company is now up to date with its financial reporting and expects to publish an unaudited quarterly update for the three months ended June 30 2019 on Aug. 29, it said on Wednesday.
($1 = 0.8943 euros)