Steinhoff International is a South African-German-Dutch international retail holding company that is dual listed in Germany and South Africa. Steinhoff deals mainly in furniture and household goods, and operates in Europe, Africa, Asia, the United States, Australia and New Zealand.
(Westerstede, Lower Saxony, Germany)
|Markus Jooste (former CEO)|
|Revenue||EUR 12.9 billion (2017/18 - 9 months)|
Number of employees
Steinhoff was founded in 1964 by Bruno Steinhoff in Westerstede, Germany. Bruno Steinhoff sourced furniture from communist Europe and sold it in Western Europe. In 1997, Steinhoff acquired 35% of South-Africa-based Gommagomma, preparing for a merger the following year. The company moved its headquarters to South Africa in 1998, attracted by the low production costs, and went public on the Johannesburg Stock Exchange that same year.
In 2005, Steinhoff invested £86 million to revive the UK's Homestyle Group, thus taking ownership of the company.
In 2011, Steinhoff bought Conforama, Europe's second largest retailer of home furnishings, with over 200 stores in France, Spain, Switzerland, Portugal, Luxembourg, Italy and Croatia, spending $1.2 billion for the acquisition.
In 2015, South African low-end retail investment and holding company Pepkor became a member of the Steinhoff International Group for $5.7 billion which made Christo Wiese Steinhoff's largest shareholder and chairman.
In December 2015, Steinhoff International moved its primary listing from the Johannesburg Stock Exchange to the Frankfurt Stock Exchange, and founded a new Dutch holding company Steinhoff International Holdings NV based in Amsterdam. This shift reflected Steinhoff's shift from its traditional Indian Ocean basin markets to the European market. The management remained in South Africa. As of 12 May 2020, Steinhoff International Holdings NV is headquartered in Amsterdam.
In July 2016, UK discount retail chain Poundland accepted Steinhoff's takeover offer of £597 million which was then increased by Steinhoff to £610 million in August 2016. The takeover received shareholder approval in September 2016.
In August 2016, Steinhoff announced its plan to purchase the US-based Mattress Firm for $3.8 billion. In 2017, Mattress Firm split from its supplier Tempur Sealy. In October 2018, Mattress Firm filed for bankruptcy but emerged from Chapter 11 bankruptcy 2 months later after financial restructuring with support from AlixPartners LLP which is a consulting firm.
A$1.9 billion margin loan was provided to Steinhoff by a consortium of lenders, including Japanese bank Nomura and a range of U.S. institutions. Nomura confirmed that it had booked an unrealised loss of 14 billion yen (or $128 million in 2018 dollars). The loan itself had been partly organised by Steinhoff's Chairman, Christo Wiese. Earlier in 2018, Steinhoff incurred accounting irregularities uncovered by Deloitte in December 2017 when Deloitte refused to sign the annual audit and booked a write-off of $12 billion. In early December 2017, Wiese announced that PricewaterhouseCoopers would investigate.
February 2018, the Enterprise Chamber of the Amsterdam Court required Steinhoff to relinquish to Andreas Seifert of XXXLutz 50% of the Steinhoff stake in POCO to indicate that Steinhoff had a 50% controlling stake not a 100% controlling stake in POCO. This court case predated cases with the accounting irregularities revealed in late 2017. In April 2018, a German court in Dortmund found that Steinhoff International could sell its remaining 50% stake in POCO to Andreas Seifert of XXXLutz for a multiple of POCO earnings which was estimated to be €532.5 million. This resulted in XXXLutz, which was the second largest furniture retailer in Europe behind only IKEA, becoming the largest furniture retailer in Germany.
Following the sale of its POCO stake in April 2018, Steinhoff will develop its markets in Eastern Europe (Pepco) and Britain (Poundland) through its Pepkor Europe assets alongside its core interests in South Africa.
On 25 April 2018, Extreme Digital, a Hungarian e commerce firm acquired by Steinhoff in October 2015, was resold to their founders Balázs Várkonyi and Gyula Kelemen through their buying back shares.
As of August 2019, Steinhoff creditors had received a 50% stake in Conforama.
On 8 July 2020, Steinhoff sold its remaining stake in Conforama France to Mobilux Sàrl which has been the furniture retailer BUT's parent company since 2016. Mobilux has 50-50 ownership by both Andreas Seifert's WM Holding, which is associated with XXXLutz through its owner Andreas Seifert, and the American investment firm Clayton, Dubilier & Rice (CD&R). In France, IKEA is the largest furniture retailer with a 15.43% market share and Conforama and BUT have market shares of 10.86% and 10.34% which are second and third, respectively.
In late November 2015, Steinhoff Europe Group Services (SEGS) offices in Westerstede were raided by German law authorities and in December 2015 German tax authorities began an investigation. Documents signed by the Austrian Andreas Seifert of XXXLutz were seized but he said that documents and his signature had been forged. Andreas Seifert of Poco and Conforama was associated with Steinhoff since 2010 when Steinhoff had acquired the French firm Conforama.
On 5 December 2017 the CEO Markus Jooste, who had been under investigation by German authorities at Oldenburg, resigned after the company announced accounting irregularities. The share price immediately plunged 66% and went on to fall by over 90% as it emerged that the company had overstated profits and assets by nearly $12 billion.
In December 2017, the Standing Committee on Finance of the Parliament of the Republic of South Africa condemned Steinhoff and called for investigations of the company by regulatory bodies including the Financial Services Board (FSB) and the South African Reserve Bank (SARB).
A PricewaterhouseCoopers investigation, requested by Steinhoff, reported in March 2019 that "A small group of Steinhoff Group former executives and other non-Steinhoff executives, led by a senior management executive, structured and implemented various transactions over a number of years which had the result of substantially inflating the profit and asset values of the Steinhoff Group over an extended period" and went on to state "it appears that the Steinhoff Group entered into a number of transactions (some of which were fictitious or irregular) with allegedly independent third party entities which resulted in the inflation of profits and asset values." The report revealed irregular transactions with eight firms not tied to the Steinhoff group from 2009 and 2017 amounted to $7.36 billion.
In March 2019 the company share price was still down 96% from its value before the scandal erupted.
In September 2019, during a presentation to their investors, the company announced its intentions to sell off non-retail assets and cut jobs at French retail chain Conforma and urgently address its $10 billion debt.
On 4 March 2021, German prosecutors in Oldenburg revealed that Markus Jooste and three others had been secretly charged four months earlier with the first indictments from the German investigations.
As of August 2016, Steinhoff held retailing activities in 30 countries, counting 6,500 retail outlets belonging to 40 different brands, and employing about 90,000 employees. 60% of the company's revenue, and two-thirds of its benefits, are made in Europe.
Steinhoff's South African brands include Ackermans, Buco, Dunns, Flash, HiFi Corp, Incredible Connection, John Craig, Pennypinchers, Pep, Refinery, Russels, Shoe City, Tekkie Town, Timbercity and Unitrans. Powersales is another African Steinhoff brand.
In Ireland, Steinhoff operates Dealz and Pep&Co. Steinhoff's other European brands include Pepco and Kika in Poland, Slovakia and Hungary.
Steinhoff expanded into the United States market on 7 August 2016 when it acquired Mattress Firm.
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