The deadline for certain investors to submit claims allowing them to cast a vote for or against retailer Steinhoff’s multi-billion-rand settlement proposal is set to expire at midnight on Wednesday.

  • Last year Steinhoff proposed a “global settlement” to resolve all the legal claims it is facing by paying out R17 billion in compensation.
  • The deadline for certain investors to be among the claimants who can vote for or against the scheme will expire at midnight on Wednesday.
  • Financial institutions say now is the time to contact them to check up on the status of claims.

The deadline for certain investors to submit claims allowing them to cast a vote for or against retailer Steinhoff’s multi-billion-rand settlement proposal is set to expire at midnight on Wednesday.

Steinhoff’s share price has fallen by about 95% since December 2017, when its former CEO Markus Jooste abruptly resigned after its auditors refused to sign off on its financials. 

Last year it proposed a “global settlement” to resolve all the claims it is facingfrom the share price plunge, without admitting any liability.

It has put forward a “pot” of €943 million (roughly R17 billion) to be split among all claimants. Insurance groups underwriting its liability and its former auditors Deloitte have put forward €78 million (R1.3 billion) each to be added to the pot.

The settlement proposal, which creditors have signed off, still needs to be voted on by claimants. The settlement process is being guided by two concurrent court processes taking place in SA and the Netherlands.

Why is Wednesday important?

Wednesday is the “voting deadline date” for claimants who want to cast a vote in proceedings under section 155 of the South African Companies Act.

This means that claimants who want to vote for or against the settlement proposal at an upcoming scheme meeting will have to file their claims by midnight on Wednesday.

Investors can still submit claims after this date, but they will not be included in the group of claimants who can vote. A date has not yet been set for the vote to take place.

A separate vote will also take place as part of the Dutch proceedings. Only if a requisite majority of claimants vote yes in both proceedings will the settlement go ahead.

Steinhoff has repeatedly urged claimants to support the settlement. It has warned that the company – which is saddled with about €10 billion in debt – may face liquidation if no agreement is reached.

Now is the time to reach out

Financial institutions say that now is the time for possible claimants – who may be confused by the complex process playing out in South African and Europe – to reach out.

“Your financial institution would advise if they have filed a claim on your behalf, because in most cases you would have needed to fill out a power of attorney,” said Bheki Mkhize, CEO of FNB Wealth and Investments Solutions. “If you are unsure, and want to vote, there is still time to do so.”

Mkhize urged possible claimants to contact their financial institution to check whether their claims have been submitted.

Janina Slawski, head of investment consulting at Alexander Forbes, noted that many investors who had exposure to Steinhoff shares through an investment vehicle such as a pooled investment policy or a unit trust did not own the shares directly.

“They can ask the life company or unit trust through which they invested as to whether they have submitted a claim,” she said.

“[But] they will not be able to share detail on whether claims will be successful, the quantum of any recovery and how this recovery would be allocated since the detail of this is still unknown.

Slawski said that large institutional investors have generally been closely following the settlement proposal since last year.

“Most of these already decided to join a class action suit which will submit claims on their behalf.”

More questions?

Depending on the particulars of a claim, claimants may either fall under the South African on Dutch proceedings.

All claimants also have to have their claims verified. 

For more information, visit the website, www.steinhoffsettlement.com, or call the toll-free number on 0860 024 737.

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