JOHANNESBURG (Reuters) – South Africa’s Steinhoff (J:) has proposed to pay round $1 billion to settle excellent authorized claims following a large accounting fraud, a fraction of the over 9 billion euros ($10.5 billion) claimants are in search of.
The announcement despatched its shares up over 11% on Monday.
The greater than 50-year-old retailer has confronted stream of lawsuits after revealing holes in its accounts in December 2017, the primary signal of the fraud estimated to whole $7 billion, and continues to be battling to get better.
Chief Govt Louis du Preez stated the corporate had been working for 12 months to place collectively the settlement, which can cowl instances from the Netherlands to South Africa, and urged all claimants to help it.
“Though there isn’t a certainty but that we can conclude this settlement, in our view these phrases are firmly in the very best pursuits of all stakeholders,” he stated in a press release.
Whereas collectors, regulators and claimants nonetheless must approve the proposal, if accepted the settlement would take away an enormous query mark over the struggling firm’s survival.
Steinhoff must liquidate if required to pay greater than 90 separate authorized claims in opposition to it in full, it stated, damaging the prospects of claimants getting paid and marking the tip of what was as soon as a prize South African firm.
Dutch shareholder group VEB stated it is going to publish its response to the proposal after buying and selling hours shut within the Netherlands.
Different claimants, together with South African businessman Christo Wiese, didn’t instantly reply to requests for remark, whereas some couldn’t be reached.
Totalling round $1 billion altogether with separate sums supplied for various teams of claimants, the settlement covers solely a fraction of the worth of the claims following the scandal.
These stood at over 9 billion euros in 2019, in keeping with Steinhoff’s annual report. Some claims wouldn’t be lined by the settlement, Steinhoff stated.
The worth can be paid in money and shares in retailer South African retailer Pepkor (J:), a Steinhoff subsidiary.
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