DURBAN - Steinhoff International wants to raise about R7.5billion through a placement of about 29.5million ordinary shares in the PSG Group with qualifying institutional investors in an accelerated book build. Steinhoff owns about a 25.5percent stake in the PSG Group.
PSG is an investment holding company that operates across a diverse range of industries which include banking, education, financial services and food-related businesses. Some of its investments include Capitec Bank, Curro Holdings, PSG Konsult and Zeder Investments.
The group said yesterday that the cash-raising exercise would only go ahead if it achieved acceptable pricing.
“If acceptable pricing is not achieved, in the sole discretion of the company, the placing will not go ahead,” Steinhoff said. PSG Capital and Standard Bank are acting as joint book runners for the placement in PSG shares.
The group said the placing would commence with immediate effect and the company reserved the right to close it at any time. “Pricing and allocations will be announced as soon as practicable following the closing of the book,” the group said.
PSG Group share price declined by 4.84percent on the JSE yesterday morning after the announcement, while Steinhoff’s shares were up by 11.09percent.
PSG shares closed 0.20percent up at R254, while Steinhoff shares gained 7.75percent to close at R8.20 on the JSE yesterday.
The retailer has faced liquidity problems since it admitted to accounting irregularities in December, which also stopped it from releasing its results for the year to end September. The group has lost about $15bn as the share price declined by almost 85percent.
Steinhoff is trying to recover from the slump, which also saw its four executives resign after the scandal. Former chief executive Markus Jooste was the first one to leave in December and he was followed by chairperson Christo Wiese immediately, with chief financial officer Ben la Grange and Jayendra Naidoo leaving early in January.
In an attempt to restore liquidity to the firm, the owners of Poundland, Conforama, Mattress Firm and Fantastic Holdings have managed to raise some cash to ease off its financial woes.
Last week it announced that it has obtained the support of its lenders in South Africa for interim liquidity in the tune of 200m (R2.97bn). The first instalment of 60m was expected to be received by Friday last week.
At the beginning of the month, US investment firm Davidson Kempner was said to have provided a loan facility of £180m (R3.02bn) to its subsidiary Pepkor Europe.
In December 2017, Mattress Firm said it succeeded in obtaining a new $75m asset-backed financing for its business, which includes the option to upsize the financing up to $225m, subject to certain conditions.
Conforama reached an agreement in January to sell its 17percent stake in Showroomprivé for about 79m.
Steinhoff is also rumoured to be considering selling its 43percent stake in JSE-listed company KAP Industrial.