Steinhoff: New R4.6bn claim chucks a spanner in the works
Dispute could delay the publication of the group’s financial statements, which were expected by April 18
Steinhoff International, the furniture retailer that has been fighting for survival for over a year, says it has received a €291.4m (R4.6bn) claim from a former business partner in Europe.
The claim could push out the publication of the group’s keenly awaited financial statements for 2017 and 2018, which are expected to be released by April 18.
Steinhoff is trying to bolster its balance sheet, though it warned earlier in January that former business partner Andreas Seifert was opposing an agreement reached with creditors in December.
The deal was approved by the vast majority of creditors and two Steinhoff subsidiaries, Steinhoff Europe AG (SEAG), and Steinhoff Finance Holding Gmbh.
Steinhoff's new CEO, Louis du Preez, said in December the agreements would be “key to bringing in a new period of financial stability for the group”.
While certain terms of the agreements with creditors still apply, the full implementation of that arrangement could be delayed until the application brought by LSW, a German entity associated with Seifert that claims to be a creditor of SEAG, has been resolved.
“LSW alleges that as at 14 December 2018, the total sum owed to LSW – inclusive of interest and costs – amounted to approximately €291.4m,” Steinhoff said on Tuesday.
The retailer has been left reeling after former CEO Markus Jooste resigned in December 2017 at the same time that the group said it had uncovered “accounting irregularities” and deep holes in its balance sheet.
That triggered a collapse in its share price, wiping more than R200bn off the company’s market value in what has become SA’s biggest corporate scandal.
Seifert and SEAG have been at loggerheads for some time. In April 2018, Steinhoff agreed to sell half of German furniture chain POCO to Seifert after a protracted dispute about the chain’s ownership.
Seifert, who owns furniture retailer XXXLutz, initially held 50% of POCO while Steinhoff owned the other half, but both had claimed they had since acquired full ownership.
Steinhoff said in its statement on Tuesday it was working to implement its financial restructuring, “and management continues to support and focus on the ongoing operations”.
The SA business remained self-funding, while Pepkor Europe had “strong levels of liquidity”.
In the US, Mattress Firm was now self-sufficient, while SEAG had provided a secured short-term funding facility to the Conforama chain for working capital.
Steinhoff also said it had sold Steinpol, a non-core manufacturer of upholstery that operates eight factories in Poland and one in Hungary.
The business had an enterprise value of €26.5m, with €9m of that being a deferred payment. The deal was expected to be closed at the end of January.