Steinhoff could face pressure to increase its £597 million offer to takeover Poundland after it was revealed that an investor now has a 13.2 per cent stake in the discount retailer.
The news comes just two days after Poundland agreed to the takeover deal by the South African retail company, after an initial takeover bid failed last month.
However, at the stock exchange on Thursday, Elliott Capital Advisors – the UK arm of US hedge fund Elliott Management – revealed it now spoke for a 13.2 per cent stake via contracts for difference (CFD).
A CFD is an agreement between two parties – the investor and the CFD provider – to pay each other the change in the price of an underlying asset, in this case Poundland shares.
While the stake is enough to block Steinhoff's takeover deal, it could still lead to headaches for the potential new owners.
Elliott is known for being a rebel investor, often pushing for change in companies and for better terms in takeovers.
A spokesman for Steinhoff told The Guardian that there would be no alteration to the terms of the deal set out on Wednesday.