Steinhoff offshoot to sell Pepkor stake

Ibex, formerly known as Steinhoff International Holdings NV., will exit its 28% stake in Africa’s largest clothing retailer, Pepkor Holdings.

Ibex sold 1.05 billion Pepkor shares at a discount of about 6% to the last closing price, according to terms seen by Bloomberg. The company raised R26.6 billion from the sale.

Demand for the shares exceeded the stock being offered within minutes of the transaction launching, the terms show.

Steinhoff changed its name to Ibex Investment Holdings Ltd. in 2023. It holds the Pepkor stake through its wholly-owned unit Ainsley.

The disposal is part of Ibex’s move to restructure Steinhoff, the former owner of Conforama in France and Mattress Firm in the US, which collapsed after auditors refused to sign off on its financial statements in late 2017.

That led to the start of police and regulatory investigations in both Europe and South Africa. A forensic probe by auditor PwC uncovered €6.5 billion of irregular transactions with eight firms over eight years.

Steinhoff built a retail empire spanning Australia, Europe and the US, including acquiring a controlling stake in Pepkor and changing the company’s name to Steinhoff Africa Retail.

The share sale will help remove an overhang on Pepkor’s shares. “The free-float of Pepkor has increased substantially due to this placement,” said Jean Pierre Verster, the chief executive officer of investment firm Protea Capital Management.

“Pepkor shareholders can now look forward to index-tracking funds increasing their weight in Pepkor shares.”

Pepkor, which owns almost 6,000 stores selling low-cost clothing, is tapping a pan-African boom in the use of phones for payment and banking services as well as for communication. Its shares closed 2% lower to trade at R27.06.