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Cape Town – Steinhoff International Holdings [JSE:SNH] announced on Thursday morning it had raised R3.75bn by selling 5.8% of its shares in Steinhoff Africa Retail Limited, or STAR.
This after the embattled conglomerate launched an accelerated book build offering of 200 million ordinary STAR shares to help refinance debt. This stock sale took place with the Stellenbosch-headquartered retailer still under a cloud related to the valuation of the company and the management of its finances.
The company is still reeling after it announced financial irregularities in its books in December, which caused its market capitalisation to be whittled down by over R200bn.
Steinhoff said it managed to place the placing shares at a price of R18.75 per placing share. This allowed the company to raise total gross proceeds of R3.75bn, representing a discount of 2.6% to the STAR closing price of R19.26 on Wednesday.
Its share price was up 11% in early trade on Thursday morning at R2.68 a share. On Wednesday its stock fell to its lowest level since its 1998 listing.
Questions are also being asked about how its former chair, retail magnate Christo Wiese, received (€325m) R4.8bn in a prepayment from Steinhoff just before the retail giant’s accounting scandal came to a head.
As Bloomberg reported, the up-front payments related to a planned merger between supermarket chain Shoprite Holdings and STAR. Wiese told Bloomberg that the deal collapsed shortly after the accounting irregularities came to light, so he agreed to return the cash.
Settlement of the placing is expected to occur on April 17.
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