Steinhoff International is considering relocating its corporate base from South Africa to Germany to be closer to its key European markets, according to sources familiar with the matter. The move would involve a Frankfurt listing and potentially a change in legal domicile, replacing a previous plan to list only its European business.
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The company, which generates around half of its revenue from continental Europe, could benefit from enhanced share liquidity and the ability to use European equity for acquisitions. Barclays, BNP Paribas, Citigroup, and Commerzbank are reportedly advising Steinhoff on the plans.
Similar transitions have been made by other South African firms with global footprints. SABMiller shifted its primary listing to London in 1999 while retaining its Johannesburg Stock Exchange (JSE) listing, a path mirrored by Anglo-American.
A Steinhoff spokesperson, Mariza Nel, declined to comment, and representatives from the involved banks were unavailable.
Locally, Steinhoff recently announced its decision to take over struggling subsidiary JD Group, acquiring 98 percent of its issued ordinary shares. JD Group, which owns furniture retailers Russells, Morkels, and Joshua Doore, has been under pressure due to challenges in its retail and finance divisions. The company increased its impairment provision by R602 million to R1.6 billion for the six months to December and wrote off R495 million in bad debts. It also ceased operations of its personal loans division.
Meanwhile, another subsidiary, KAP Industrial, reported a 9 percent increase in revenue to R7.8 billion and a 9.2 percent rise in profit to R710 million over the same period. The company expressed optimism as South Africa's manufacturing sector showed signs of recovery.
Steinhoff's recent international acquisitions include French retailer Conforama and Austrian group kika-Leiner, as the firm continues to expand its presence in Europe.
Source: www.iol.co.za