Poundland Owner Steinhoff Restructures €9bn Debt Amidst Accounting Irregularities

  • Steinhoff confirms refinancing of €9bn debt after accounting scandal
  • European revenue rose by 13% to €1.7bn in the first half of 2019
  • Accounting irregularities discovered in December 2017 led to £5.7bn loss through suspected fraud
  • Steinhoff Europe AG and Steinhoff Finance Holding GmbH entered CVA with creditors last year
  • CEO Louis du Preez: ‘restructuring is a major milestone on the recovery journey’
  • Stakeholders thanked for support, commitment to improving operational businesses

Poundland owner Steinhoff has confirmed the refinancing of €9bn (£8.3bn) of debt after being involved in an accounting scandal that led to a loss of over £5.7bn through suspected fraud. The company announced this in its half-year report, where European revenue rose by 13% to €1.7bn (£1.57bn) for the period up to 31 March 2019. Accounting irregularities were first found in December 2017. Steinhoff Europe AG (SEAG) and Steinhoff Finance Holding GmbH (SFHG) entered into a company voluntary arrangement (CVA) with its creditors last year, confirming the CVA agreements on August 14th. SEAG’s €5.6bn (£5.19bn) of debt, plus around €2.8bn (£2.59bn) from SFHG and a further €400,000 (£370,000) from another business has been reissued with maturities from December 2021 and no cash interest payments. CEO Louis du Preez said: ‘The months of hard work on the financial restructuring have today come to fruition. Implementation of the Restructuring is a major milestone on our recovery journey, bringing with it the stability that will allow us to turn the page and concentrate fully on maximising value from our operating companies.’ The company wishes to express its gratitude to its stakeholders for their support throughout the restructuring. Steinhoff remains committed to improving the performance of its operational businesses across the Group, reducing its debt, resolving legal claims against it, and delivering value for its stakeholders.

Factuality Level: 8
Factuality Justification: The article provides accurate information about Steinhoff’s refinancing of its debt, the increase in European revenue, and the CEO’s statement on the restructuring process. However, it lacks some details about the accounting scandal and does not mention the exact amount of debt reissued from other businesses.
Noise Level: 3
Noise Justification: The article provides relevant information about Steinhoff’s refinancing efforts and the company’s progress in addressing accounting irregularities and restructuring. It also includes a statement from the CEO. However, it could benefit from more detailed analysis of the specific actions taken to address the issues and potential long-term consequences for the company.
Financial Relevance: Yes
Financial Markets Impacted: Steinhoff’s refinancing of €9bn (£8.3bn) debt impacts financial markets as it affects the company’s operations and creditors, and also has implications for investors and stakeholders.
Financial Rating Justification: The article discusses Steinhoff’s refinancing of a significant amount of debt and its impact on the company’s operations, creditors, investors, and stakeholders. It also mentions accounting irregularities and restructuring efforts, which are financial topics.
Presence Of Extreme Event: Yes
Nature Of Extreme Event: Financial Crisis
Impact Rating Of The Extreme Event: Severe
Extreme Rating Justification: This rating is based on the significant financial losses and restructuring efforts due to accounting irregularities and debt refinancing, which affected the company’s operations and stakeholders.

Reported publicly: www.retailsector.co.uk