Steinhoff’s overseas business restructures debt after scandal

Steinhoff CEO Louis du Preez says the company remains committed to improving performance. (Reuters)
Updated 14 August 2019

Steinhoff’s overseas business restructures debt after scandal

  • 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

JOHANNESBURG: Scandal-hit Steinhoff said it had refinanced some €9 billion ($10 billion) of debt in its overseas operations which include brands such as Poundland in the UK 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 percent 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 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.

SEAG’s €5.6 billion of debt, plus around €2.8 billion from SFHG and a further €400,000 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 August 29, it said on Wednesday.


Saudi finance minister reassures public on taxes

Updated 10 December 2019

Saudi finance minister reassures public on taxes

  • Mohammed Al-Jadaan: There will be no more fees and taxes until after the financial, economic and social impacts have been considered carefully
  • The government expects to generate about SR203 billion in taxes this year – more than 20.5 percent higher than the previous year

RIYADH: Saudi finance minister Mohammed Al-Jadaan pledged that there would be no more taxes or fees introduced in the Kingdom until the social and economic impact of such a move had been fully reviewed.

He was speaking at the 2020 Budget Meeting Sessions, organized by the Ministry of Finance and held in Riyadh on Tuesday, where a number of ministers and senior officials gathered following the publication of the budget on Monday evening.

“There will be no more fees and taxes until after the financial, economic and social impacts have been considered carefully, especially in terms of economic competitiveness,” said Al-Jadaan.

The government expects to generate about SR203 billion in taxes this year – more than 20.5 percent higher than the previous year and more than 10 percent higher than the expected budget for this year. 

Most of that increase has come from taxes on goods and services which rose substantially as a result of the improvement in economic activity over the year.

The reassurances from the minister come as the Saudi budget deficit is estimated to widen to about SR187 billion, next year, or about 6.4 percent of GDP.