TEINHOFF: LAUNCH OF WHOA RESTRUCTURING PLAN
Steinhoff International Holdings N.V. is referred to as "SIHNV" or the
"Company" and with its subsidiaries, " Steinhoff" or the "Group"; "Group
Services Debt" means the indebtedness under (i) the Contingent Payment
Undertakings ("CPUs") entered into by SIHNV; and (ii) the debt facilities
entered into by Steenbok Lux Finco 1 S.à.r.l. ("LuxFinco 1 "), Steenbok Lux
Finco 2 S.à.r.l. ("LuxFinco 2") and Hemisphere International Properties B.V.
("Hemisphere") (the instruments together, the "Group Services Debt
Facilities"), each as amended from time to time.
Steinhoff's Management Board and Supervisory Board resolved on 28 March 2023
to initiate a Dutch law restructuring plan (akkoord) ("WHOA Restructuring
Plan") to implement its proposed maturity extension transaction (the "Maturity
Extension Transaction") in respect of its Group Services Debt, first announced
by the Company on 15 December 2022.
The launch of the WHOA Restructuring Plan follows the rejection of the
proposal to approve the Maturity Extension Transaction and related equity
reorganisation by the Company's shareholders at the Company's annual general
meeting held on Wednesday 22 March 2023 (the "2023 AGM").
An outline of the restructuring plan was included in the Company's circular
to shareholders issued on 8 February 2023 in connection with the 2023 AGM (the
"Circular"). A draft version of the WHOA Restructuring Plan, supporting
valuations by BFI and Analysis Group and related materials will be available on
the Company's website on 29 March 2023.
The WHOA Restructuring Plan will affect the Company's financial creditors,
certain intra group creditors and the Company's shareholders. The WHOA
Restructuring Plan does not affect the Company's obligations in respect of the
global litigation settlement that was successfully concluded on 15 February
2022.
The launch of the WHOA Restructuring Plan will initiate a period of
consultation on the terms of the proposed plan between the Company and the
affected stakeholders. The Company estimates that this consultation period
will take at least two weeks. Affected stakeholders may submit views on the
draft WHOA Restructuring Plan during this consultation period via email to
compsec@steinhoffinternational.com.
At the conclusion of the consultation period, the Company will finalise its
restructuring plan and set out the timetable for consideration and voting on
the plan by the affected classes. Updates on the timetable and information
about how affected stakeholders may exercise their voting rights will be
provided by the Company on the Company's website in due course.
Under the terms of the WHOA Restructuring Plan, the Maturity Extension
Transaction will, amongst other things, result in the following amendments. .
An extension of the maturity date under the Group Services Debt Facilities,
associated CPUs of theCompany and intercompany loans to at least 30 June 2026,
with two twelve-month extension options available withmajority lender consent
under each of the Group Services Debt Facilities. . the Steinhoff Europe AG
("SEAG") Facility A2 lenders receiving the full benefit of the SEAG CPU after
therefinancing of the SEAG Facility A1 and SEAG Facility A2. The SEAG Facility
A2 lenders will also benefit from areclassification of the existing SEAG
Facility A2 into an instrument which is fully covered by the SEAG CPU (sizedat
87% of the existing SEAG Facility A2), with the excess (13%) to be reclassified
to SEAG Facility B2 or a newtranche fungible with SEAG Facility B2 (which does
not benefit from a CPU). This effectively represents an increasein CPU coverage
for the SEAG Facility A2 lenders from 80.3% to 87%. . An amendment and
extension of the Hemisphere facilities on terms announced on 16 December 2022.
. A resetting of the SEAG Facility A2 coupon at 10.0% (compounding
semi-annually) from 30 June 2023 fromthe current 10.75%. To ensure full CPU
coverage for SEAG Facility A2 going forward, the notional rate under theSEAG
CPU will be aligned to grow at the same rate. . Amendments to the relevant debt
documents of the Group resulting in CPU holders being paid ahead of anyholders
of equity instruments issued by SIHNV or any new ultimate parent entity of the
Group (such new ultimateparent entity of the Group, "New Topco"). . A "solvent
distribution regime" to facilitate an efficient distribution of the Group's
assets at fairvalue directly to financial creditors, subject to any legal and
regulatory restrictions, if debt has not beendischarged in full at extended
maturity (or following any earlier acceleration). The regime includes
limitedrecourse terms and "solvent liquidation" provisions for the benefit of
SIHNV (including New Topco) and itssubsidiaries. . As previously disclosed,
given that the Company's general meeting did not approve the Maturity
ExtensionTransaction and related equity reorganisation at the 2023 AGM, it is
intended that under the WHOA RestructuringPlan 100% of the potential economic
interests in the post-closing equity of the Group will be for the benefit ofthe
individual financial creditors as at the date of completion of the
restructuring. . In a change to the position described in the Circular, it is
now proposed that the financial creditorswill be issued CVRs by New Topco on
substantially similar terms to the CVRs that had been originally proposed to
beissued to the SIHNV shareholders. As set out in the Circular, New Topco
will be an unlisted company. The sharesin New Topco will be held by five
separate and independent Dutch foundations. The financial creditors will
notreceive depositary receipts from the Dutch foundations as previously
indicated in the Circular. . As part of the WHOA Restructuring Plan, it is
envisaged that such number of ordinary shares in SIHNV willbe issued to the
separate and independent Dutch foundations that they will in aggregate hold 50%
plus one share inthe share capital of the Company. . The expectation is that
following implementation of the Maturity Extension Transaction, a proposal
willbe made to the shareholders of the Company to dissolve and liquidate SIHNV
which, if approved, will result in theexisting SIHNV shares including their
current listings falling away with no financial compensation payable
toshareholders. The dissolution of SIHNV (including the termination of the
secondary listing on the JohannesburgStock Exchange) is subject to approval of
the South African Reserve Bank.
The support agreement entered into by the Company, Newco 3 and the several
financial creditors as announced on 15 December 2022 remains in place and the
intention remains to implement the Maturity Extension Transaction by the "Long
Stop Date" of 30 June 2023.
If the WHOA Restructuring Plan is not successful or is not confirmed by the
Dutch court by 30 June 2023, the Company may be in default under the relevant
finance documentation as per 30 June 2023 and certain elements of the Maturity
Extension Transaction including the equity reorganisation may be implemented by
way of enforcement of security rights by the financial creditors alongside the
implementation of other terms of the Maturity Extension Transaction. In these
circumstances, SIHNV would lose its interests in the underlying Group
businesses and assets and shareholders would retain no economic interest in the
restructured Group.
The Maturity Extension Transaction, including the equity reorganisation, is
subject to new financial creditor consents and confirmation by the Dutch Court.
There is no certainty that such consents or confirmation order will be achieved
before the current maturity date under the Group Services Debt of 30 June 2023
following which the financial creditors may enforce their rights.
The Company has a primary listing on the Frankfurt Stock Exchange and a
secondary listing on the JSE Limited.
Disclaimer
The information in this announcement is not intended to be complete. This
announcement is for information purposes only and does not constitute an offer,
or any solicitation of any offer, to buy or subscribe for any securities. The
distribution of this announcement may, in some countries, be restricted by law
or regulation. Accordingly, persons who come into possession of this document
should inform themselves of and observe these restrictions. To the fullest
extent permitted by applicable law, Steinhoff disclaims any responsibility or
liability for the violation of any such restrictions by any person. Any failure
to comply with these restrictions may constitute a violation of the securities
laws of that jurisdiction. Steinhoff does not assume any responsibility for any
violation of any of these restrictions. Any SIHNV shareholder who is in any
doubt as to his or her position should consult an appropriate professional
advisor without delay.
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