The group’s share price plummeted by more than 80% (losing €14 billion in market cap), and credit lines began to be withdrawn, resulting in significant operational and liquidity pressure. Steinhoff urgently needed new money and sought relief from its creditors with respect to €10 billion of debt.
FTI Consulting helped Steinhoff recover value for stakeholders by providing the conglomerate with adequate time and liquidity to restructure, allowing for 13,000 stores to remain open and 120,000 jobs to be preserved. Within six months, over 90% of creditors had locked into the restructuring agreement FTI Consulting had brought to the table.
FTI Consulting helped creditors for the South African retail conglomerate Steinhoff to preserve value and restructure in the wake of fraud allegations, management resignations and a plummeting share price.
FTI Consulting was initially engaged in a restructuring capacity and was ultimately appointed as a financial advisor to the coordinating committee of the group’s creditors. Once accounting irregularities were identified, FTI Consulting's experts around the globe were mobilised to uncover the truth.
FTI Consulting supported engagement with creditors including negotiations, which resulted in more than 90% of creditors — more than 100 financial institutions — locking into an agreement.
After providing the analysis and advice to creditors, FTI Consulting was the architect of the restructuring.
FTI Consulting’s efforts to provide lenders with clarity on Steinhoff’s true financial performance provided a stable platform to restructure the group’s debt and deliver a solvent solution to return value to lenders.
In a high-risk engagement like this, you rely on your most senior people and trusted relationships to support your vision. Without that support, we would never have landed on such a creative solution.
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