Steinhoff faces angry shareholders as it renegotiates debt

Retailer vows to reinstate trust after accounting scandal wipes billions off stock value

Heather Sonn, chairwoman of Steinhoff:  “We want to uncover the truth, show the world was has happened, prosecute any wrongdoing and reinstate trust in the company.” Photograph: Jasper Juinen/Bloomberg

Heather Sonn, chairwoman of Steinhoff: “We want to uncover the truth, show the world was has happened, prosecute any wrongdoing and reinstate trust in the company.” Photograph: Jasper Juinen/Bloomberg

 

South African retailer Steinhoff is in talks with creditors about restructuring its debt, it said on Friday as it faced shareholders for the first time since an accounting scandal surfaced in December.

Steinhoff, which runs chains such as Dealz/Poundland and Mattress Firm, is fighting for survival after discovering holes in its books. The accounting scandal wiped billions off its stock market value and triggered a cash crunch.

“We want to uncover the truth, show the world was has happened, prosecute any wrongdoing and reinstate trust in the company,” chairwoman Heather Sonn said at the retailer’s annual general meeting in Amsterdam, where the company is registered.

Steinhoff’s financial situation remains “very challenged” and the company has been “drained of working capital”, the company said in a presentation.

Liquidity has been assured for now after €750 million was raised, partly through asset sales, though Ms Sonn said this strategy is not sustainable and debt needs to be restructured.

Ahead of a vote to re-elect directors, she said it was important to retain executives with knowledge of the company to ensure survival.

“There was a time in early December that it could be likened to finding oneself in a burning building,” she said. “Typically when in a burning building you run out. Some stayed. We are happy some stayed in the burning building to help.”