Debt-laden Steinhoff International said on Wednesday it plans to sell up to 6.5% of Pepkor, a move that means it loses its majority stake in SA’s biggest retailer by store footprint.
Based on Pepkor’s closing price on Wednesday, the sale could net Steinhoff about R4.7bn, with the intention of using the proceeds to pay down debt.
Steinhoff currently owns 51% of Pepkor, and the successful placement of the shares would mean he would retain 44.5% ownership of the retailer, whose brands include Ackermans, Shoe City, JD Group and The Building Company. The company would remain Pepkor’s largest shareholder, with its second-largest shareholder being Public Investment Corporation (PIC), which owned 6.2% of the retailer as of the end of its 2022 year.
Steinhoff, valued at just 1.87 billion rand on the JSE, is still struggling with debt of around 10.2 billion euros (191 billion rand), announcing in December that it had reached a deal with its biggest creditors, That could allow you to have 80% of the company. Shareholders, who would retain 20%, are expected to vote on this on March 22, and approval would mean the company would be delisted.
READ | Steinhoff shares fall as creditors look set to take control
In January, Steinhoff also sold a 6.6% stake in pan-European retailer Pepco, raising 315.2 million euros (5.8 billion rand). This brought the group’s share to 73.2%, from 78.9% previously.
Steinhoff’s announcement came as JSE closed on Wednesday, when its shares fell 12%, after losing more than 82% in the past six months.
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