Banks have granted Steinhoff International’s former chief executive officer, Markus Jooste, another extension to pay back his debt, as the global retailer which he headed struggles to survive an accounting scandal that happened under his watch.
Jooste’s personal investment company, Mayfair Holdings, struck a deal with banks in March this year to sell assets of more than $2-billion to repay debt owed to the lenders by December. Lenders and other creditors have now agreed that Jooste, 57, has until March 31 2019, to repay his debts without interest, Stefan Potgieter, Mayfair’s sole director, told some stakeholders in an email seen by Bloomberg.
Potgieter confirmed the extension.
“We continue to enjoy the support of our creditors for an orderly process in the interest of all stakeholders, which might include further postponements of deadlines, if needs be,” wrote Potgieter, who is also Jooste’s son-in-law.
Mayfair’s biggest asset is sweetmaker Lodestone Brands. The founders of the company, whose brands include Rascals candies and Champion toffees, remain minority shareholders and are considering making an offer to buy back the business, said sources familiar with the situation, who asked not to be named because this hasn’t been publicly announced.
Such an offer would cover the R959-million in debt owed to Mayfair’s three main lenders — Sanlam, Investec and Absa, according to sources, who declined to say how much the minorities would propose paying.
After Steinhoff shares crashed when it reported a hole in its accounts in December, Mayfair defaulted on its share-backed loans. That gave banks an option to liquidate the company or come up with a breakup proposal to release capital. While the three lenders agreed that the latter course would realise more value there have been no significant disposals to date and the three banks continue to hold the debt on their books.
“Any suggestion that we are not dealing with the matter in the usual manner by, for example, being unduly lenient to Mayfair is inaccurate,” said an Absa spokesman. “It is Absa’s intention to pursue the scheme-of-arrangement process, as well as any other legal remedies that may be available to it, until such time as all obligations owed by Mayfair to Absa are fulfilled.”
Investec and Sanlam confirmed that an extension has been granted. — Fin24