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Poundland owner in talks over £3.6bn sale or float

Published: 16 August 2019 - Kiran Grewal

Poundland owner Pepkor Europe is reported to be considering a sale or flotation in September, as it looks to separate itself from parent company Steinhoff.

According to the Times, Pepkor will look at a €4 billion (£3.66 billion) sale next month, after refinancing its high-interest debts and distancing itself from Steinhoff.

Founded in 1990, Poundland has 853 shops in the UK and Ireland, and was sold to Steinhoff for £610 million in 2016.

Steinhoff then combined the group with its Pepkor discount chain in Europe, alongside its fashion brand Pep & Co.

It is understood by the Times that Pepkor Europe has held meetings with legal advisers and will seek advice next month on a dual track process to explore a stock exchange listing and a sale.

Sources said that the business would probably have a valuation of at least €4 billion and was likely to attract significant interest from private equity firms.

In March, the South African retail giant confirmed it had overstated profits between 2009 and 2017 in a $7.4 billion (£6.1 billion) fraud.

 

Earlier this week Steinhoff’s chief executive Louis du Preez said the only way the parent retail group could survive would be by selling off its assets to cut debt following what’s thought to be the biggest case of corporate fraud in South African business history.

Steinhoff is looking to offload its non-retail assets and cut jobs at Conforama – its French retail chain.

Louis du Preez, who was appointed as the new chief executive in January this year, told investors this week that Steinhoff’s strategy to sell off its assets was the “only way to survive”.

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