Steinhoff to sell about R4.7bn of Pepkor, lose majority stake

Debt-laden Steinhoff International said on Wednesday it plans to sell up to 6.5% of Pepkor, a move which means it loses its majority stake in SA’s largest retailer by store footprint.

Based on Pepkor’s closing price on Wednesday, the sale could net Steinhoff about R4.7 billion, with the intention to use the proceeds to pay down debt. 

Steinhoff currently owns 51% of Pepkor, and successful placement of the shares would mean it would retain 44.5% ownership of the retailer, whose brands include Ackermans, Shoe City, JD Group and The Building Company. The company would remain Pepkor’s biggest shareholder, with its second-biggest shareholder being the Public Investment Corporation (PIC), which held 6.2% of the retailer as of the end of its 2022 year.

Steinhoff, valued at only R1.87 billion on the JSE, is still battling with about a €10.2 billion (R191 billion) debt pile, and announced in December that it had reached a deal with its largest creditors, which could see it holding 80% of the company. Shareholders, who would retain 20%, are expected to vote on this on 22 March, and approval would mean the company would then delist.

READ | Steinhoff shares slump as creditors look set to take control

In January, Steinhoff also sold a 6.6% chunk of its stake in pan-European retailer Pepco, raising €315.2 million (R5.8 billion). This took the group’s stake to 73.2%, from 78.9% previously.

Steinhoff’s announcement came as the JSE closed on Wednesday, when its shares fell 12%, having lost more than 82% over the past six months.

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