Christo Wiese-linked Steinhoff secures creditor approval for debt restructuring plan

In a significant development for Steinhoff International Holdings, the South African retail conglomerate linked to billionaire retail magnate Christo Wiese, creditors have overwhelmingly approved the company’s debt restructuring plans.

The approval sets the stage for Steinhoff to seek a Dutch court’s endorsement of the scheme, marking a crucial milestone in the retailer’s journey toward recovery.

The newly approved debt restructuring plan entails extending the maturity date of the company’s “group services debt” from June 30, 2023, to at least June 30, 2026.

The Wiese-linked retailer intends to approach a Dutch court to obtain the necessary endorsement for the scheme, following the publication of a voting report on Wednesday.

One of the notable highlights of the restructuring plan is the unanimous support it received from all three classes of creditors, including the conditional payment undertaking (CPU), secured, and unsecured creditors. This resounding backing signifies a vote of confidence in Steinhoff’s future prospects and underscores the faith in the proposed transformation.

Pending court approval, the proposed plan entails the delisting of the parent company, paving the way for the establishment of an innovative unlisted holding structure. This strategic move is expected to reshape the company’s trajectory and position it for sustainable growth. 

Shareholders, under the restructuring plan, will be granted rights to a 20-percent stake in the new entity. This interest can be converted into monetary value if Steinhoff successfully pays off its debt and achieves profitability in the future.

Since the 2017 accounting scandal, which led to the departure of disgraced businessman Markus Jooste, Steinhoff has grappled with financial challenges.

However, under the leadership of CEO Louis du Preez, the company has been diligently working towards recovery and debt reduction. 

Despite the hurdles faced, Steinhoff continues to hold a significant position in the global retail industry.

With operations in more than 30 countries, the company generates billions in revenue annually and provides employment opportunities to thousands of individuals worldwide.

Steinhoff’s ties with South African billionaire and retail tycoon Wiese, the largest shareholder in 2017, underscores the company’s significance. 

Wiese, renowned for his pivotal contribution to the expansion of Shoprite, the largest retailer in Africa, has played a crucial role in Steinhoff’s efforts to regain stability.

As of the drafting of this report, his net worth stands at an impressive $1 billion, positioning him among Africa’s wealthiest individuals.

Omokolade Ajayi
Omokolade Ajayi
Omokolade Ajayi is a financial reporter at Billionaires.Africa. Previously, he worked as a journalist at Nairametrics. Omokolade is a seasoned financial analyst and reporter with in-depth knowledge of and expertise in equity markets, and financial and economic analysis. He has a degree in economics and is a certificate holder of the CFA Institute’s Investment Foundation Program.

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