Business Maverick: Steinhoff Likely Near to Settling $11 Billion in Legal Claims

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South Africa News News

Steinhoff International Holdings NV is close to reaching a potential deal on 10 billion euros ($11 billion) of legal claims lodged against the global retailer following an accounting scandal that almost wiped out the company, according to two people with knowledge of the matter.

Steinhoff’s South African claimants — including former Chairman Christo Wiese whose suit amounts to 59 billion rand — have been offered a combination of cash and shares in Pepkor Holdings Ltd., one of the people said. It isn’t immediately clear how much a settlement could amount to, the people said, asking not to be identified because talks are continuing and a deal may not be reached. Steinhoff owns 68% of Pepkor, Africa’s largest clothing retailer.

Lawsuits replaced debt as Steinhoff’s most pressing concern after the retailer struck a deal with creditors to skip principal and interest payments on its borrowings through 2021. Steinhoff’s shares collapsed in late 2017 when the owner of Conforama in France and Pep stores in Europe and Africa became locked in a battle to survive following allegations that the company orchestrated transactions to artificially boost its profits and asset values.

 

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