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- Steinhoff has increased the amount it is willing to pay out to claimants who lost out in its share price plunge by R3.2 billion in a bid to win more votes.
- The retailer's total settlement offer now stands at €1.426 billion, or around R25 billion at current exchange rates.
- Steinhoff says one of the largest investor groups that was opposed to its initial offer has accepted the new proposal "in principle".
Retailer Steinhoff has announced it will increase its proposed payout to investors who lost out in its share price plunge - by another R3.2 billion.
The extra R3.2 billion is in addition to a separate increase announced last month.
Its total settlement offer now stands at €1.426 billion (around R25 billion), up from €1.2 billion in July and €970 million last year.
Steinhoff has said that settling the more than 100 court cases it is facing in SA and Europe is a "critical priority", which would free it from the overhanging threat of litigation and allow it to focus on reducing its debt.
The court cases stem from the precipitous drop in its share price in late 2017 when its CEO Markus Jooste abruptly resigned when the first signs of an accounting scandal came to light. The share-price collapse cost investors tens of billions of rands.
Bid to increase support
Steinhoff said on Wednesday that it opted to increase the amount it was offering litigants to win more support for its global settlement proposal.
It has repeatedly urged claimants to vote for its settlement offer, saying the company may have to be liquidated if not agreement is reached.
As part of the proposed deal, litigants will receive a proportion of their verified claims, according to a term sheet drawn up by Steinhoff. In return, they will have to drop all legal challenges against the retailer, absolving it of any liability.
Steinhoff said the extra R3.2 billion will only be distributed among market purchase claimants, one of three classes of claimants.
It said that investor group Hamilton, which has dragged it to court in South Africa, supports the revised proposal "in principle".
Hamilton previously argued that Steinhoff's settlement proposal was "unfair and inequitable".
But the increased offer appears to have won it over, with one of its directors, Oscar McLaren, stating that it was now at the "financial level at which we can add our in-principle support".
"We look forward to continuing to work with Steinhoff towards implementation of the Steinhoff settlement for the benefit of all market purchase claimants," he said.
Voting nears
The retailer said that an independent claims administrator who has been assessing the claims of litigants would "shortly" send a notice to potential market purchase claimants advising them on whether they are eligible to vote in upcoming meetings.
The meetings will be held on 6 September.
Market purchase claimants who did not file their claims prior to the 5 May deadline will not be allowed to vote, said Steinhoff, but but may still be eligible to receive payouts.
They should visit the website created to oversee the process.
