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SHF - Steinhoff International Holdings Limited - Pricing of Convertible Bonds
Steinhoff International Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration Number 1998/003951/06)
Share Code: SHF & ISIN: ZAE000016176
NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE, DIRECTLY OR INDIRECTLY, IN OR INTO
THE UNITED STATES OF AMERICA (INCLUDING ITS TERRITORIES AND POSSESSIONS),
AUSTRALIA, CANADA OR JAPAN.
RELEASED IN SOUTH AFRICA FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE
AN OFFER TO SOUTH AFRICAN INVESTORS.
10 March 2011
STEINHOFF INTERNATIONAL HOLDINGS LIMITED
1. Introduction
Steinhoff International Holdings Limited ("SIHL") this morning announced the
launch of its offering of senior unsecured guaranteed convertible bonds due
March 2018 (the "Bonds").
The Bonds will be issued by Steinhoff Finance Holding GmbH (the "Issuer") which
is a 100% subsidiary of SIHL incorporated in Austria. The Issuer`s payment
obligations under the Bonds will be guaranteed by SIHL, which is rated Ba1
(stable outlook) by Moody`s, and the Bonds will be convertible into up to
approximately 142 million ordinary shares of SIHL (assuming the overallotment
option is exercised in full by the Citigroup Global Markets Limited and BNP
Paribas, the "Joint Bookrunners").
The offering of the Bonds was launched at the open of trading this morning and
is now priced. The offering was oversubscribed.
2. Salient Terms of the Bonds
SIHL announces that the terms for the Bonds have been fixed as follows:
- issue size is EUR 450 million (subject to increase by up to EUR 25 million
pursuant to the overallotment option which SIHL has granted to the Joint
Bookrunners, which is exercisable up to close of business in South Africa on 14
March 2011);
- the initial conversion price has been set at ZAR 31.78 per ordinary share,
based on a fixed exchange rate of EUR 1.00 = ZAR 9.5248. The initial conversion
price represents a 32% premium over the volume weighted average price ("VWAP")
of the ordinary shares of SIHL on the JSE Limited (the "JSE") from launch to
pricing;
- the coupon has been set to 4.50% per annum, payable semi-annually in arrear
commencing on 30 September 2011;
- the yield to maturity of the Bonds is 5.75% per annum (calculated on a semi-
annual basis);
- the issue price of the Bonds is 100% of their principal amount;
- unless previously redeemed or converted, the Bonds will be redeemed at 110.68%
of their principal amount on 31 March 2018;
- the Issuer will have the right to redeem all outstanding Bonds at their
Accreted Principal Amount together with accrued interest on or after 14 April
2016 if the parity value of the Bonds translated into Euro at the prevailing
exchange rate shall have exceeded 140% of the Accreted Principal Amount of the
Bonds for a specified period, or, at any time at their Accreted Principal Amount
together with accrued interest if less than 10% of the Bonds originally issued
remain outstanding; and
- the Bonds are convertible into up to approximately 142 million ordinary shares
of SIHL based on the above initial conversion price (assuming exercise in full
of the overallotment option), which represents approximately 9.3% of SIHL`s
current issued ordinary share capital.
The proceeds of the issue of the Bonds will be used for general corporate
purposes of the group, as enlarged after the implementation of the acquisition
of Conforama Holding S.A. as announced on SENS on 31 January 2011, including
further extending and diversifying the debt maturity profile and to provide
financial flexibility for strategic initiatives. In particular, the issuance of
7-year funding on favourable terms facilitates the refinancing of shorter term
facilities including the acquisition facilities secured for the Conforama
acquisition.
In accordance with the Listings Requirements of the JSE, PwC Corporate Finance
(Proprietary) Limited ("PwC") has been appointed by the board of directors of
SIHL as independent expert to consider the conversion terms of the Bonds in
relation to the fairness of the conversion terms to the ordinary shareholders of
SIHL. PwC is of the opinion that the terms and conditions of the issue of the
Bonds are fair to SIHL`s shareholders. A copy of their opinion has been
submitted to the JSE`s Issuer Services Division and, subject to their approval,
will become available for inspection at the registered office of the SIHL for a
period of two weeks from the date of closing. A further announcement with
respect to the approval of the fairness opinion will be published in due course.
Application will be made to include the Bonds for trading on the Open Market
(Freiverkehr) of the Frankfurt Stock Exchange.
3. Unaudited Pro-forma Financial Effects of the Bonds
The unaudited pro forma financial effects of the Bonds on the published
unaudited interim results of SIHL for the six months ended 31 December 2010 have
been calculated on the basis that the Bonds excluding the overallotment option
were issued on 1 July 2010, the start of the most recently released interim
period for the six months ending 31 December 2010.
Due to the nature of these unaudited pro forma financial effects, they are
presented for illustrative purposes only and may not fairly present SIHL`s
financial position or the results of its operations following the issue of the
Bonds. Consequently, historical performance is not an appropriate reflection of
future prospects. The unaudited pro-forma financial effects are the
responsibility of the SIHL directors.
- The pro forma financial effects of the Bonds excluding the overallotment
option on SIHL`s earnings per share, headline earnings per share and net asset
value per share are not significant (less than 3%), and have therefore not been
disclosed;
- The pro forma financial effects of the Bonds excluding the overallotment
option on the diluted earnings per share is a 5.8% reduction from 108.5 cents
per share to 102.2 cents per share; and
- The pro forma financial effects of the Bonds excluding the overallotment
option on the diluted headline earnings per share is a 5.8% reduction from 108.6
cents per share to 102.3 cents per share.
The pro forma financial effects of the Bonds excluding the overallotment option
have been based on the following assumptions:
- Proceeds from the Bonds excluding the overallotment option are assumed to have
been used on 1 July 2010, with interest saved and incurred on the Bonds (before
tax) converted at an average exchange rate of EUR 1.00 = ZAR 9.4495, the average
exchange rate for the six month period ending 31 December 2010; and
- Tax has been computed at the SIHL`s average tax rate for six month period
ending 31 December 2010.
Citigroup Global Markets Limited is acting as sole global co-ordinator and
acting as joint bookrunner with BNP Paribas. Citigroup Global Markets Limited is
acting as sole stabilising manager (the "Stabilising Manager") for the offering
of the Bonds. Commerzbank AG and Standard Bank are acting as co-bookrunners for
the offering of the Bonds.
For more information, please contact:
Steinhoff International Holdings Limited:
Markus Jooste
+27 (21) 808 0735
Piet Ferreira
+27 (21) 808 0761
Mariza Nel
+27 (21) 808 0754
Transaction sponsor: Citigroup Global Markets (Proprietary) Limited
Company sponsor: PSG Capital (Proprietary) Limited
Independent expert in respect of the Bonds: PwC Corporate Finance (Proprietary)
Limited
This announcement is not for publication, distribution or release, directly or
indirectly, in or into the United States (including its territories and
dependencies, any State of the United States and the District of Columbia). The
securities referred to herein have not been and will not be registered under the
U.S. Securities Act of 1933, as amended (the "Securities Act"), and may not be
offered or sold in the United States without registration there under or
pursuant to an available exemption there from. Neither this document nor the
information contained herein constitutes or forms part of an offer to sell or
the solicitation of an offer to buy securities in the United States. There will
be no public offer of the Bonds in the United States or in any other
jurisdiction.
In member states of the European Economic Area which have implemented the
Prospectus Directive (Directive 2003/71/EC) (each, a "Relevant Member State"),
this announcement is directed exclusively at persons who are "qualified
investors" within the meaning of Article 2(1)(e) of the Prospectus Directive and
pursuant to the relevant implementing rules and regulations adopted by each
Relevant Member State.
In the United Kingdom this announcement is directed exclusively at Qualified
Investors (i) who have professional experience in matters relating to
investments falling within Article 19(5) of the Financial Services and Markets
Act 2000 (Financial Promotion) Order 2005, as amended (the "Order") or (ii) who
fall within Article 49(2)(A) to (D) of the Order, and (iii) to whom it may
otherwise lawfully be communicated.
This announcement is not intended to be nor is it an offer for sale or
subscription to the public as contemplated under Chapter VI of the South African
Companies Act No.61 of 1973 nor does it constitute an offer for subscription,
sale or purchase of the Bonds to any South African resident persons or company
or any non-South African company which is a subsidiary of a South African
company. A South African resident person or company or any non-South African
company which is a subsidiary of a South African company is not permitted to
acquire the Bonds unless the express prior written approval of the South African
Reserve Bank has been obtained.
In connection with the issue of the Bonds, the Stabilising Manager or any person
acting on behalf of the Stabilising Manager may over-allot Bonds or effect
transactions with a view to supporting the market price of the Bonds at a level
higher than that which might otherwise prevail. However, there is no assurance
that the Stabilising Manager (or any persons acting on behalf of the Stabilising
Manager) will undertake stabilisation action. Any stabilisation action, if
begun, may be ended at any time, and must be brought to an end after a limited
period.
This announcement is not an offer of securities or investments for sale nor a
solicitation of an offer to buy securities or investments in any jurisdiction
where such offer or solicitation would be unlawful.
Date: 10/03/2011 17:50:12 Supplied by www.sharenet.co.za
Produced by the JSE SENS Department.
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JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
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