DGAP-News: Steinhoff International Holdings N.V. : UPDATE ON PROGRESS OF FINANCIAL RESTRUCTURING
22.01.2019 (www.4investors.de) -
DGAP-News: Steinhoff International Holdings N.V. / Key word(s): Miscellaneous
Steinhoff International Holdings N.V. : UPDATE ON PROGRESS OF FINANCIAL RESTRUCTURING
22.01.2019 / 06:05
The issuer is solely responsible for the content of this announcement.
UPDATE ON PROGRESS OF FINANCIAL RESTRUCTURING
Steinhoff International Holdings N.V. (the "Company" and with its subsidiaries, the "Group")
In accordance with the Company's reporting obligations under paragraph (e) of clause 20 of the lock-up agreement between, among others, the Company, Steinhoff Europe AG ("SEAG"), Steinhoff Finance Holding GmbH ("SFHG"), Stripes US Holding, Inc. ("SUSHI") and certain creditors, dated 11 July 2018 (the "LUA"), please see below the monthly update on progress in connection with the corporate and capital restructuring of the Group's European business (the "Restructuring").
Defined terms used but not otherwise defined in this report shall have the same meaning as in the company voluntary arrangement proposed in relation to SEAG (the "SEAG CVA") and/or the company voluntary arrangement proposed in relation to SFHG (the "SFHG CVA") (as applicable and as the context dictates).
This report should be read in conjunction with recent market announcements (available at www.steinhoffinternational.com/sens.php), including the most recent monthly update issued on 21 December 2018 (the "December Update"). Following a period of intense activity leading up to the meetings in respect of the SEAG CVA and SFHG CVA on 14 December 2018, as reported in the December Update, there is less to report than in some previous updates following the Christmas and New Year break.Update on Restructuring and creditor support
The SEAG CVA and the SFHG CVA were both approved by significant majorities of their respective creditors and by their members at meetings held on 14 December 2018. The SEAG CVA documentation and SFHG CVA documentation can be downloaded at www.lucid-is.com/steinhoff.
On 10 January 2019, SEAG was notified of an application issued by LSW GmbH ("LSW"), a company claiming to be a creditor of SEAG, challenging the SEAG CVA (the "Application"). Aside from the Application, no challenges were received to the SEAG CVA within the challenge period (i.e. the period of 28 days beginning on the day on which the SEAG CVA Chairman's Report was filed at the Court). No challenges were received to the SFHG CVA within the challenge period (i.e. the period of 28 days beginning on the day on which the SFHG CVA Chairman's Report was filed at the Court). As the challenge periods have now expired, no further challenges are permitted.
The potential LSW claim is described in and, should the claim be finally determined or resolved in LSW's favour, is addressed by the terms of the SEAG CVA. LSW alleges that as at 14 December 2018 the total sum owed to LSW (inclusive of interest and costs) amounted to approximately EUR291.4m. The Application seeks to challenge certain provisions of the SEAG CVA and related matters.
Certain relevant terms of the SEAG CVA and the SFHG CVA, including the interim moratoria, continue to apply. The Company continues to work towards the implementation of the financial restructuring of the Group and management continues to support and focus on the ongoing operations.Head office liquidity
As previously reported in the December Update, the Company continues to actively monitor cash flows and manage other liabilities (including contingent claims, tax and bilateral facilities) as well as funding needs that may arise at the subsidiary level. The South African business remains self-funding whilst the Pepkor Europe (including Poundland) business continues to benefit from strong levels of liquidity. Mattress Firm is self-supporting following the emergence from chapter 11. As indicated in the December Update, SEAG has provided a secured short-term funding facility to Conforama to provide working capital support to the Conforama group.Update on Group governance
The onboarding process between the Group and the four candidates identified for the Newco 3 board and the boards of the key intermediate holding companies in the SEAG group is ongoing. The Group expects to announce the candidates publicly prior to the Restructuring Effective Date. As previously reported in the December Update, the Newco 3 board will include two directors nominated by the Company. Those two initial directors are expected to be Louis du Preez and Theodore de Klerk.
As previously indicated, Danie van der Merwe stepped down as the Group's Chief Executive Officer on 31 December 2018; Louis du Preez was appointed Group CEO immediately into this role thereafter.Group structure
Pursuant to the SEAG CVA and the SFHG CVA, Lux Finco 1 and Lux Finco 2 were incorporated on 28 December 2018.Financial statements
The Company currently anticipates publishing its Group audited financial statements for 2017 and 2018 by 18 April 2019, subject to any delay caused by the challenge to the SEAG CVA.
The Company expects to publish its unaudited quarterly update for the three months ended 31 December 2018 in line with the usual reporting timetable (i.e. by 28 February 2019).Corporate finance
On 11 January, the sale of Steinpol, a non-core manufacturer of entry level to mid-price upholstery operating eight factories in Poland and one factory in Hungary, was agreed. The enterprise value for the business amounts to EUR26.5 million of which EUR9 million is deferred consideration. Closing is expected on or around 31 January 2019 and is subject primarily to merger control clearance.Current management priorities
The key priorities for the management team currently include:
Resolving the challenge received to the SEAG CVA;
Satisfying the various conditions precedent contained within the SEAG CVA and SFHG CVA and otherwise planning for the implementation of the Restructuring;
Working with the prospective members of the new management boards to assist their familiarisation process with the SEAG group and its restructuring;
Maintaining stability across the Group and managing the ongoing operations of the Group, including actively monitoring cash flows, supporting operating performance, managing other liabilities and funding needs that arise at the operating company level;
Finalising the 2017 and 2018 Annual Financial Statements;
Assisting PwC with the ongoing investigation into accounting irregularities together with other work required to progress and finalise the restatement of accounts;
Monitoring and defending any litigation claims brought against the Group and identifying and pursuing recoveries where available; and
Engaging with the wider stakeholder group and regulators.
Shareholders and other investors in the Company are advised to exercise caution when dealing in the securities of the Group.
Stellenbosch, 22 January 2019
22.01.2019 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.The issuer is solely responsible for the content of this announcement.The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.de
Steinhoff International Holdings N.V.
1017 CA Amsterdam
Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover, Munich, Stuttgart, Tradegate Exchange
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