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Steinhoff establishes subsidiary to list African assets

Steinhoff International Holdings NV said Aug. 4 that it has formed a subsidiary under the name of Steinhoff Africa Retail Ltd., or STAR, to list its African retail assets on the main board of South Africa's Johannesburg Stock Exchange Ltd.

Subject to market conditions, STAR's listing process is expected to be completed by the end of September.

The subsidiary has been set up as a single holding company, which took effect July 1 and includes the South African home furnishing retailer's African retail businesses Pepkor Holdings Ltd., JD Group Ltd., Steinhoff Doors and Building Materials (Pty) Ltd., Poco South Africa and Tekkie Town. It also encompasses a specialty division, including brands such as Dunns, John Craig, Refinery and Shoe City.

In addition, Steinhoff and STAR signed call options agreements with the Public Investment Corp. SOC Ltd., Lancaster Group Proprietary Ltd., Titan Premier Investments Proprietary Ltd. and one of its subsidiaries.

The agreement allows STAR to acquire economic and voting interests in Thibault Square Financial Services (Pty) Ltd. and Shoprite Holdings Ltd. Once the call options are implemented, STAR will have a 22.7% economic stake in Shoprite as well as 50% of the voting rights in Shoprite.

The consideration for the implementation of the call options is based on a share price of 215 South African rand per share for the approximately 128.2 million rand underlying ordinary shares of Shoprite, as well as 4 billion rand attributable for the deferred voting shares and an additional 4 billion rand for cash and cash equivalents owned by Thibault. Under the agreement, STAR will issue a fixed number of its ordinary shares as payments for the transaction.

The call options will be implemented subject to certain regulatory conditions.

As of Aug. 4, US$1 was equivalent to 13.46 South African rand.