Steinhoff Seeks $1.8B Lifeline To Stay Afloat
Following revelations of accounting irregularities last week, Steinhoff International Holdings NV Chairman Christo Wiese is attempting to keep the struggling retailer afloat, by seeking a US$1.8 billion margin loan.
Chairman Wiese is reportedly negotiating a standstill agreement on the 1.5 billion-euro margin loan, to which banks would suspend the sale of stock until next year.
South African billionaire, Wiese, is Steinhoff’s biggest shareholder, and is making strides to save the struggling company, who reportedly owes creditors as much as $21 billion.
Shares in the South African based, Frankfurt-listed company, reportedly plunged 82% last week, following news that its Chief Executive has resigned.
Steinhoff International boasts operations in more than five continents – including in Australia where it owns retailers such as Freedom, Fantastic, POCO, Snooze and Best & Less.
The news comes after former The Good Guys CEO, Michael Ford, was appointed to lead Steinhoff Asia Pacific Group Holdings. Mr Ford resigned in April after 13 years of tenure with The Good Guys, with former JB Hi-Fi CEO, Terry Smart, appointed as his successor.
German authorities are currently investigating the company’s financial reports, to determine whether inflated assets and revenues were included.
The crisis has wiped significantly sums away from shareholders.
Some London analysts warn that Wiese and its Senor Executives could be very close to receiving jail time.
Since announcing the investigation of its books, Steinhoff has warned about the “recoverability” of €6 billion in assets outside South Africa.