DGAP-News: Steinhoff International Holdings N.V. / Key word(s): Miscellaneous Steinhoff International Holdings N.V. : 2021-08-11 / 10:30 The issuer is solely responsible for the content of this announcement. ----------------------------------------------------------------------------------------------------------------------- STEINHOFF INTERNATIONAL HOLDINGS N.V. - FURTHER INCREASED SIHPL SETTLEMENT OFFER AND NOTICE OF SECTION 155 CREDITORS' MEETING Steinhoff International Holdings N.V. ("SIHNV" or the "Company", together with its subsidiaries, "Steinhoff" or the " Steinhoff Group") and the former South African holding company for such subsidiaries, Steinhoff International Holdings Proprietary Limited ("SIHPL"), provide the following updates on their global litigation settlement proposal. Further increase in SIHPL's contribution to settlement offer SIHNV refers to its announcement on 16 July 2021 setting out terms of a revised settlement offer, ("16 July Offer"). As has been reported by Steinhoff in previous announcements (published at https://www.steinhoffinternational.com/ sens.php), SIHPL is subject to various legal disputes arising from the proposed settlement arrangements in addition to those disputes arising from the legacy accounting issues. Whilst Steinhoff has received positive responses to its 16 July Offer, indications have been that it has attracted insufficient overall support to achieve certainty of outcome in the proposed SIHPL section 155 process. Recognising that the recent disputes focus on the proposed SIHPL settlement arrangements, Steinhoff has given consideration to whether a further and final increase to the SIHPL settlement offer can be made in order to achieve the necessary levels of support. Therefore, Steinhoff now proposes that SIHPL make an additional contribution to the SIHPL market purchase claimants' settlement consideration of ZAR 3,214 million. Steinhoff believes that the adjusted proposed settlement can resolve both legacy claims and, in SIHPL's case, the more recent disputes. In relation to this additional contribution by SIHPL: - The additional contribution will not be available to any other SIHPL claimants nor SIHNV claimants (whether SIHNV market purchase claimants or contractual claimants). - The additional contribution is being made available by SIHPL alone and does not of itself result in an adjustment to the increased amount of the SIHPL/SIHNV loan note announced in the 16 July Offer (but the SIHPL/SIHNV loan note will be subject to minor downward adjustment as a result of the Trevo proposal described below). - The additional contribution will be allocated proportionately among SIHPL Market Purchase Claimants based on their respective claims as determined under the existing Allocation Plan rules. - As previously clarified, the precise level of distribution to such claimants will depend on the final level of accepted claims made by the applicable bar date under the scheme plans, since the settlement sum will be applied for the benefit only of those SIHPL market purchase claimants that establish claims submitted by the bar date. - SIHPL will retain its option to provide settlement consideration in respect of any claim in cash, or 50 per cent in cash and 50 per cent in PPH shares (at R15 per share), other than in relation to the proposals previously announced in relation to BVI and certain PPH managers. - As previously, this revised offer is subject to necessary regulatory approvals and financial creditor approvals described below and does not constitute an admission of liability by any member of the Steinhoff Group, or its directors, officers or employees in respect of any legal claims or litigation proceedings. Steinhoff has received confirmation that the Active Claimant Group, Hamilton, supports in principle the Steinhoff global settlement based on this increased contribution by SIHPL, and will withdraw from the class composition application which has been adjourned until 13 August 2021 on that basis. Hamilton's final approval of the S155 proposal will be subject to the ongoing claim verification process. SIHPL confirms that it has received confirmation that four large Steinhoff financial creditors - funds managed or advised by The Baupost Group, LLC, Farallon Capital, Sculptor Capital Management and Silver Point Capital - are supportive of this further revision to the settlement terms. Louis du Preez, Chief Executive Officer and Management Board member, said: "We recognise that SIHPL has faced opposition resulting in legal proceedings relating to the particular terms of its settlement proposal. The proposed additional contribution by SIHPL to the overall settlement is in response to those challenges. We still believe that a global settlement is in the interests of both SIHNV and SIHPL and indeed the entire Group. With this additional contribution and the positive response from Hamilton and our proposal in relation to Trevo, we will move ahead to hold the creditors' meetings in the SIHPL process and to continue the SoP process with a vote on the SIHNV Composition Plan by the Committee of Representation, to seek the necessary approvals and to finalise the Steinhoff settlement." Oscar McLaren, a director of Hamilton said in relation to the increased SIHPL offer: "We are pleased to confirm our in-principle support for the increased offer by SIHPL and we believe that the overall Steinhoff settlement is now at a financial level at which we can add our in-principle support. We look forward to continuing to work with Steinhoff towards implementation of the Steinhoff settlement for the benefit of all market purchase claimants." Summary of Cumulative Increased Settlement Proposal (including the 16 July Offer) A summary of the increased settlement offer including the 16 July Offer is as follows: Original Revised total settlement settlement amount (July amount (inc. 16 July 2021 & 11 Total increase in settlement amount 2020) August 2021 offers) since July 2020 EURm ZARm EURm ZARm EURm ZARm % Inc. SIHNV & SIHPL Market Purchase 267 442 175 66% Claimants SIHNV Contractual Claimants 103 171 68 66% Hemisphere CPU 40 66 26 66% SIHPL Contractual Claimants: Titan 7,904 7,904 - - SIHPL Contractual Claimants: Other 1,653 1,653 - - SIHPL Market Purchase Claimants - 3,214 3,214 n.m. (current increase) EUR Total (of EUR and ZAR amounts) 969 1,426 457 47%
(1) The values in this table have been calculated for information purposes using an exchange rate of 17.0906 and exclude certain provisions for costs.
(2) In addition, as announced on February 14, 2021, the terms of settlement with Conservatorium include a consideration payable by Steinhoff Africa Holdings Pty Limited (on behalf of SIHPL) in the amount of € 61 million.
(3) The values “SIHPL Contractual Claimants: Other” in this table include the amount reserved in relation to Mayfair’s disputed Contractual Claim against SIHPL. This component of the consideration will only be paid to Mayfair if it succeeds in its dispute with SIHPL and will otherwise go to SIHPL.
Modification of the handling of Trevo complaints under the proposal for Article 155 of the SIHPL
As part of the upcoming changes to the SIHPL Section 155 proposal, SIHPL will provide that Trevo will be treated as an ineligible requestor, instead of being a purchase requestor in the SIHPL market as previously proposed. SIHPL disputes and will continue to dispute Trevo’s claim. However, SIHPL acknowledges that the particular circumstances giving rise to Trevo’s claim cast doubt on the appropriateness of treating it as a Purchase Claimant on the SIHPL market and justify its reclassification as an ineligible Claimant.
In the circumstances, SIHPL has therefore modified the proposal of Article 155 to provide that Trevo’s claim will be withdrawn from the category of applicants to purchase on the SIHPL market (being a category of applicants to whom an offer in compromise is made. in terms of the Section 155 Proposal) and, in accordance with Trevo’s Proposal and its stated preference, that Trevo be treated as an Ineligible Claimant (being a party who has asserted claims against SIHPL that have been disputed by SIHPL, and to whom the offer in compromise is not made in terms of the proposal).
Steinhoff believes that this approach removes Trevo’s legal position in the Section 155 proposal and provides a basis for terminating Trevo’s subsequent involvement in the group composition application that was filed in the High Court in Cape Town. , whose hearing is currently adjourned to August 13, 2021.
For the avoidance of doubt, Trevo’s alleged claim will not be compromised under the Section 155 proposal and, therefore, Trevo’s treatment should not affect the completion and early approval of the proposal of article 155.
The treatment of Trevo as an ineligible applicant will result in a minor downward adjustment of the SIHPL / SIHNV loan rating from EUR 166 million to EUR 164 million.
The next key steps expected in the context of the Steinhoff dispute resolution proposal are as follows:
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August 11, 2021 04:30 ET (08:30 GMT)