Steinhoff scrambles to raise $1.1bn by selling off private jets & shares

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Steinhoff

Steinhoff has sold off a raft of small assets worth around $1.1 billion (£775 million) as it scrambles to secure cash to prevent an all-out collapse.

According to Bloomberg, the embattled South African retail company has sold its private jet and ceased funding the rugby team of Stellbosch University, where former chief executive Markus Jooste attended.

It also announced the sale of $590 million (£416 million) worth of shares in financial service company PSG Group on Monday in its biggest sale of assets since the accounting scandal broke in December.

However, analysts have predicted that larger and more significant sales will be required to repay what banks, bond holders, suppliers and creditors are owed, estimated to be around $18 billion (£12 billion). $1.5 billion (£1 billion) in bond and loan repayments is reportedly due in this year.

“Selling smaller assets that are not essential to its operations is part of its strategy,” industry expert Syd Vianello told Bloomberg.

“But I don’t think it will stop there. Banks will want their money and want it quickly, so there will be big sales forced on them.”

Steinhoff has seen its share prices fall over 80 per cent since it was revealed that it must restate its financial results due to “accounting irregularities”.

Since then, the company said that financial statements as far back as 2015 would have to be restated.

Little has been revealed about the extent of the accounting irregularities, although Bloomberg analyst Charles Allen said that Steinhoff’s scramble for small amounts of money “points to the extent of the problems”.

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