Steinhoff looks to reassure investors over liquidity
Retail group Steinhoff International put out another statement on Thursday as it looked to reassure investors over its liquidity position, after announcing the departure of its chief executive a day earlier amid “accounting irregularities”.
The group, which owns brands such as Poundland, Bensons for Beds and Conforama, said it has received expressions of interest in certain non-core assets that will release a minimum of €1bn of liquidity.
In addition, the company’s subsidiary, Steinhoff Africa Retail Limited (STAR), will on Thursday formally commit to the refinancing of its long-term liabilities.
“It is expected that the STAR refinancing will be concluded on better terms than those applicable to STAR’s current liabilities due to Steinhoff, given the strong cash flow inherent in its business. The additional liquidity of circa €2bn expected to be achieved through these measures will strengthen the company’s balance sheet and should provide additional comfort to stakeholders of the company’s ability to be able to fund its existing operations and reduce debt.”
Steinhoff also said there was no evidence to suggest that chief financial officer Ben La Grange had any involvement in the matters under investigation. As a result, he will remain in his position and has resigned from his role of CEO of STAR so he can focus solely on his position at Steinhoff.
On Wednesday, shares in company plummeted as its CEO Markus Jooste resigned with immediate effect amid accounting irregularities, while the release of the company's 2017 numbers were postponed.
The group, which owns more than 40 local brands in over 30 countries, said it has approached PWC to carry out an independent investigation after new information came to light related to accounting irregularities.
"Steinhoff will update the market as the aforesaid investigation proceeds. The company will publish the audited 2017 consolidated financial statements when it is in a position to do so. In addition, the company will determine whether any prior years’ financial statements will need to be restated."