Dutch court confirms Steinhoff’s settlement plan passes another milestone
Share this article:
STEINHOFF International Holdings has gained the approval of a Dutch court to compensate shareholders who lost their monies when the company’s share price went bust in 2017.
The company said last week that the District Court of Amsterdam had issued an order confirming its proposed global settlement. The group said the settlement plan would become binding following an eight-day period if no appeal was lodged within that period.
Steinhoff chief executive Louis du Preez said: “While our task is not yet complete, this judgment is a further significant milestone in concluding the global litigation settlement.
“With the decision of the Dutch committee of representation and the court, together with the positive voting in all of the recent claimant meetings in South Africa, we have seen overwhelming support for our global settlement proposal,” said Du Preez.
A South African court needs to also approve the settlement. The Western Cape High Court is scheduled to hear Steinhoff’s sanction application at the end of the month.
The majority of South African shareholders gave their support for the proposed settlement in creditors’ class meetings held earlier this month.
Steinhoff is facing legal claims amounting to more than R130 billion for the share price collapse when former chief executive Markus Jooste quit and accounting irregularities came to light in December 2017.
Steinhoff, the majority owner of Pepkor in Africa and Pepco in Europe, proposed a global settlement that will see it paying out R25 billion to shareholders.
The settlement is expected to allow management to focus on the ongoing restructuring and improving the group’s underlying businesses. Steinhoff’s plan to address its corporate scandal faces a major hurdle as the founders and former owners of shoe retailer Tekkie Town want the group to be liquidated.
Former Tekkie Town owners and management have asked the court to liquidate Steinhoff and its subsidiary Pepkor after they were “duped” to accept restricted Steinhoff shares in exchange for a controlling interest in Tekkie Town.
Earlier this month Steinhoff announced it had raised R7.3bn from the sale of 370 million Pepkor shares toward the proposed settlement.
Steinhoff sold 10 percent in Pepkor which operates discount fashion retailers including Pep, and Ackermans through the sale of up to 370 million Pepkor shares.