Steinhoff to sell more assets
As the troubled retailer scrambles for working capital.
Scandal-hit Steinhoff plans to sell off more assets to become a retail-focused holding company in a bid to survive after it recovered €6.5 billion (about R111 billion) in accounting fraud, sparking a share price collapse.
In 2017, Steinhoff admitted to accounting irregularities, wiping more than 85 percent off its market value. This has left the retailer scrambling for working capital as it has a €6.5 billion hole in its accounts due to fraud uncovered by a PwC forensic investigation from its 2009 financial year to 2017.
During a first public presentation to investors this week since the scandal took hold, Steinhoff CEO Louis du Preez (pictured) said a radical transformation into a retail-focused investment holding company was its “only way to survive”. This means that the retailer might sell more assets as well as cut jobs at its French retail chain Conforama.
Louis didn’t name the assets that might be up for sale.
The company has already sold off a number of assets, including an Austrian furniture chain and stakes in firms like KAP Industrial.
Its remaining portfolio includes furniture and household goods firms such as Mattress Firm in the United States and the Fantastic chain in Australia, general merchandise outlets including Britain’s Poundland, and a host of clothing stores.
According to a Bloomberg report, Steinhoff was considering an initial public offering of its Pepkor Europe unit, which owns Poundland as well as retail chains Dealz and Pepco. But Louis said Steinhoff was considering all options and that no decision had been made.