DURBAN - Pepkor Holdings, a subsidiary of Steinhoff International, said yesterday it had raised R1.9billion in an accelerated bookbuild, with the proceeds to be used to reduce the retailer’s gearing level, secure the business against uncertainties and provide investors with an opportunity to invest in the future growth of the business.
Pepkor announced the placement of 172.5 million ordinary shares in the authorised but unissued share capital of the company to certain institutional investors at R11 a share, which represents a 6.2percent discount to the pre-launch 30-business day volume weighted average price of R11.73 a share, as at market close on Tuesday.
The group said it was pleased to announce the successful completion of the bookbuild as it raised gross proceeds of R1.9bn for the company.
“The placement shares represent in aggregate 4.95percent of the company’s issued ordinary share capital prior to the placement. The placement shares when issued will be fully paid and will rank pari passu in all respects with the company’s existing ordinary shares in issue, including the right to receive all dividends and other distributions declared, made or paid after the date of issue of the placement shares,” the group said.
It said an application would be made to the JSE for the listing of the placement shares. “The placement is a precautionary measure to strengthen Pepkor’s financial flexibility and liquidity position in the light of the continuing Covid-19 pandemic, and resulting macro-economic pressure. In addition to other cash-saving initiatives already undertaken by the group, the placement will help Pepkor to further enhance the liquidity profile and increase resilience of its balance sheet, should a more negative macro-economic scenario be realised.”
However, former Tekkie Town directors said the issue price was some 49percent below the value at which Steinhoff listed its basket of African retail assets in September of 2017, when the company debuted on the JSE as Steinhoff Africa Retail.
“It was also some 31percent below the value of the share days after the revelations emerged of accounting irregularities and alleged fraud at the company’s parent Steinhoff International,” said former Tekkie Town chief executive Bernard Mostert.
Pepkor Holdings shares closed at R11.41 on the JSE yesterday.