| Thu 9 Dec 2010, 8:45 | | SHF - Steinhoff International Holdings Limited - Cautionary announcement |
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SHF
SHF
SHF - Steinhoff International Holdings Limited - Cautionary announcement
regarding Steinhoff International Holdings Limited entering into exclusive
negotiations with PPR S.A with the intention of acquiring Conforama Holding S.A
STEINHOFF INTERNATIONAL HOLDINGS LIMITED
Incorporated in the Republic of South Africa
Registration Number: 1998/003951/06
Share Code: SHF & ISIN: ZAE000016176
9 December 2010
STEINHOFF INTERNATIONAL HOLDINGS LIMITED
("Steinhoff")
CAUTIONARY ANNOUNCEMENT REGARDING STEINHOFF ENTERING INTO EXCLUSIVE NEGOTIATIONS
WITH PPR S.A ("PPR") WITH THE INTENTION OF ACQUIRING CONFORAMA HOLDING S.A
("CONFORAMA")
1. Introduction
Steinhoff announces that it has entered into exclusive negotiations to acquire
100% of the issued share capital of Conforama, a leading European retailer of
furniture and household goods, from PPR for a cash consideration of EUR 1,207
million ("the Proposed Acquisition"). It is intended that the consideration will
be financed through an appropriate mix of available cash resources, debt and
equity that would include a combination of up to 137 million ordinary shares
("the SHF shares"), unlisted perpetual preference shares and an acquisition
facility of EUR 600 million provided by a consortium of six banks. The SHF
shares will be issued as a vendor consideration placement to a foreign long-term
strategic investor, subject to the prescribed pricing parameters of the Listings
Requirements of the JSE Limited ("the JSE").
Subject to the successful conclusion of the negotiations relating to the
transaction, Conforama will refund PPR`s working capital facility and, in this
regard, Steinhoff has secured a new working capital facility for Conforama.
2. Information on Conforama
Conforama is a leading retailer of furniture and household goods. It operates
from a network of 241 stores, of which 190 stores are located in France making
it France`s second largest furniture and household goods retailer. In addition,
Conforama operates 51 stores in 6 other European countries.
Conforama`s sales amounted to EUR 3.01 billion for the twelve months ended 30
June 2010. Conforama`s real estate assets include 98 owned retail sites, 14
warehouses and 6 administrative buildings. Conforama employs 13,400 people.
3. Process
The proposed transaction should be concluded in the coming weeks, following
consultation with personnel representative bodies, as required under French law,
and will be submitted for the approval of the relevant competition authorities.
The proposed transaction is also subject to approval in General Meeting by
Steinhoff shareholders ("General Meeting") of the related Category 1 ordinary
resolution (in respect of which a 50% + 1 majority is required). A circular
containing details of the proposed acquisition, including a notice convening a
General Meeting, will be sent to Steinhoff shareholders once a definitive
agreement has been concluded between Steinhoff and PPR.
In order to procure the exclusive negotiations with PPR, Steinhoff has secured
the support of holders of 53% of its ordinary shares for this transaction.
4. Cautionary Announcement
Shareholders and Convertible bond holders of Steinhoff (collectively, "security
holders") are advised that the Proposed Acquisition, if successfully concluded,
may have a material effect on the price of the Steinhoff`s securities.
Accordingly, security holders are advised to exercise caution when dealing in
the company`s securities until a definitive agreement is concluded and a full
announcement, including the financial effects thereof, is made.
5. Comments by Company Officers
Mr. Francois-Henri Pinault, Chairman and Chief Executive Officer of PPR, has
stated: "This planned cession to a global furniture sector player is a major
strategic opportunity for Conforama. This proposed offer would reflect a
strategic valuation recognizing the true value of the company, its brand, and
the work achieved by the team. The operation, entirely consistent with the
company`s strategy, would favour its development and would underline the calibre
of its employees and management. Since its acquisition by PPR in 1991, Conforama
has enjoyed significant development both in France and internationally, to
become one of the leaders in household goods in Europe. Steinhoff International
has an intimate understanding of Conforama`s business and the two companies
operate in complementary markets. The expertise and experience of these two
players would provide Conforama with the means to successfully continue to mine
the potential of its markets."
Mr. Markus Jooste, Chief Executive Officer of Steinhoff, has stated: "Should
this transaction be concluded, it will allow us to reinforce our position as one
of Europe`s leading integrated furniture and household goods companies by giving
us access to key markets such as France, one of Europe`s largest household goods
markets, and other territories where Conforama operates. Steinhoff will also
continue to support and honour its strategic relationships with retail partners
and customers in its traditional territories where it has operated for more than
40 years. Furthermore we will support Conforama in the implementation of its
exciting growth plans for the future."
Mr Thierry Guibert, Chairman and Chief Executive Officer of Conforama, has
stated: "I would be particularly proud and eager to see Conforama join the
Steinhoff group. With Conforama being part of an industry player like Steinhoff,
we will be able to pursue the strategic goals of the company, accelerate its
development and establish itself as a leader in products for the home."
Johannesburg
9 December 2010
Financial advisors to Steinhoff
Citigroup Global Markets Limited
HSBC
The Royal Bank of Scotland
South African investment bank
Standard Bank
JSE transaction sponsor to Steinhoff
Citigroup Global Markets (Proprietary) Limited
JSE sponsor to Steinhoff
PSG Capital (Proprietary) Limited
Date: 09/12/2010 08:45:01 Produced by the JSE SENS Department.
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