Steinhoff to buy Homestyle
December 13, 2006
By Tiisetso Motsoeneng
Johannesburg - Furniture group Steinhoff Europe - a unit of the JSE-listed Steinhoff International – on Wednesday said it would acquire the remaining 39 percent stake in UK retailer Homestyle for £326.4 million (R4.48 billion).
Steinhoff Europe, which already holds 61 percent stake in the company, said it would offer 100 pence in cash for each scheme share held or 0.736 new Steinhoff shares and not more than one of its own shares for each share in Homestyle.
The group said the share offer at R23.51 a share - the closing price of Steinhoff's share yesterday, the day before the announcement, - was equal to 126 pence at a pound versus rand exchange rate of R13.77.
"Whilst progress is being made in improving many areas of our business, restoring acceptable levels of performance across the Homestyle Group is a long term project and we believe profitability will be restored more rapidly under the ownership structure proposed by Steinhoff Europe and Steinhoff International," Donald Macpherson, chairman of Homestyle said.
Markus Jooste, chief executive officer of Steinhoff International, said that the group considered the scheme to be in the best interest of Homestyle to help facilitate its long-term recovery.
"The scheme enables Homestyle shareholders to realise their investment for either cash or new shares in Steinhoff International," he said.
"By electing for the share election, the minority Homestyle shareholders will have the opportunity to continue to benefit indirectly from Homestyle's recovery and prospects as a wholly-owned subsidiary of Steinhoff Europe and through the global vertically integrated business model and strategy of Steinhoff International," he added. - I-Net Bridge
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