Steinhoff International Holdings, a South Africa-based global retail holding linked to retail mogul Christo Wiese, has begun a series of payments to shareholders who lost their investments in the company when its shares fell in 2017.
The move comes nearly three weeks after it received approval from a Cape Town high court to pay the investors a total of $1.62 billion as it prepares to settle more than R122 billion ($8 billion) in combined claims from its 2017 accounting scandal, which resulted in the resignations of Markus Jooste and Wiese.
The execution of the €1.43-billion ($1.62 billion) settlement offer will put Steinhoff in a position to successfully focus on debt reduction while its management, led by CEO Louis du Preez, increases efforts to recover from the fraud crisis.
In an update to shareholders, Steinhoff stated that yesterday, Feb. 15, was the “settlement effective date” for the settlement offer, and that, as such, payments will begin through a body named Stitching Steinhoff Recovery Foundation, which will manage the $1.62-billion settlement.
Further measures under the settlement will be conducted in the following weeks and months, according to the retailer, which has begun the transfer of Pepkor shares to those parties who sold their businesses to Steinhoff in return for shares.
As of press time on Feb. 16, shares in Steinhoff were trading at R4.31 ($0.286) on the Johannesburg Stock Exchange, 137 basis points lower than its opening price on the local exchange this morning.
The retailer’s market capitalization is R18.7 billion at the present pricing, while Wiese’s 2.3-percent stake is valued at R420.5 million ($27.9 million).
The market value of the businessman’s investment in Shoprite has increased by more than $48 million since the start of the year due to a recent increase in the retailer’s shares on the Johannesburg Stock Exchange.
