Steinhoff to delay Pepco sale as unit’s CEO takes leave
JOHANNESBURG - Steinhoff International Holdings NV is delaying the potential sale of its European retail arm Pepco Group amid heightened market volatility and the illness of the unit’s chief executive officer, people with knowledge of the matter said.
Pepco Group CEO Andy Bond, who made his name in U.K. retail circles turning around the Asda supermarket chain, is taking a leave of absence for medical reasons unrelated to coronavirus, according to the people. Steinhoff, which had been considering a sale or listing of Pepco, plans to delay the process until later this year, the people said, asking not to be identified because the information is private.
Buyout firms including Advent International and Partners Group Holding AG have been considering bids for Pepco Group, which owns the Poundland discount chain, Bloomberg News reported in January. Steinhoff was seeking to value the business at more than 4 billion euros ($4.5 billion) in a sale, people with knowledge of the matter said at the time.
The Steinhoff delay comes as the coronavirus outbreak curtails dealmaking across the world, scuppering acquisition talks and forcing companies to delay share sales as equity markets tumble. Steinhoff, the South African retailer whose stock plunged in an accounting scandal, said in November it was evaluating options for Pepco Group including a listing.
Representatives for Steinhoff and Pepco Group declined to comment. Steinhoff’s stock dropped as much as 15% in Johannesburg. The shares have lost about a quarter of their value this week.
Pepco Group has more than 2,800 stores in 14 markets, according to its website. Its operations include the Pepco discount clothing and decor chain, which has a presence in eastern European countries including Poland, Romania and Bulgaria. The company also runs Poundland stores in the U.K. and Dealz outlets in Ireland, Spain and Poland.
Bond, who owns a personal stake in Pepco Group, was part of the team that revamped Asda’s operations in the years leading up to its 1999 sale to Walmart Inc. He rose through the ranks and eventually became chief executive officer of the U.K. grocer after Walmart’s takeover.
Other members of Pepco Group’s top management include Chief Financial Officer Nick Wharton, a former executive at Superdry Plc and Dunelm Group Plc, and ex-Tesco Plc executive Trevor Masters, who is managing director of the group’s Pepco chain.