Steinhoff going to court for approval

Steinhoff has applied to a Dutch court for approval of its restructuring plan that would make it binding on all lenders and shareholders, saving it from imminent bankruptcy. The court will hear the application on June 15.

Steinhoff intends to enter a restructuring process known as the WHOA (Court Confirmation of Extrajudicial Restructuring Plan/Wet Homologatie Onderhands Akkoord) to avoid being forced into bankruptcy in June with its assets sold in a fire sale.

The company, burdened by scandal and debt, is now worth about €7bn. It must repay €10.2bn of debt by June 30, but cannot do so. The restructuring plan involves delisting it and placing it in the care of a trust.

SHAREHOLDERS … ARE LIKELY TO END UP WITH NOTHING

In May, all the lenders voted in favour of the WHOA plan, agreeing to extend the debt repayment date to June 2026, which gives them three years to sell Steinhoff’s assets at the best prices possible.

However, shareholders overwhelmingly rejected the proposal .

German shareholder group SDK (Schutzgemeinschaft der Kapitalanleger) asked the court to appoint an independent expert, saying Steinhoff is worth more than it owes.

The court rejected this request on Thursday.

In terms of the plan, shareholders could get 20% of what is left of the company after the hedge funds holding the debt are repaid, but they are likely to end up with nothing.