Lancaster 101 has abandoned a court bid against Steinhoff’s settlement offer to dozens of aggrieved shareholders, removing one of the stumbling blocks for the company to close a chapter in the country’s biggest accounting fraud.
Lancaster, Jayendra Naidoo’s investment outfit that borrowed billions of rand from the Public Investment Corporation to buy into Steinhoff, is among investors that opposed Steinhoff’s R14bn offer to settle claims worth more than R130bn from shareholders and business partners who filed lawsuits on grounds that they were duped into buying worthless shares.
Under Steinhoff’s offer, Lancaster would get about R200m, pocket change compared with a claim of more than R12bn that prompted Naidoo in March to challenge the settlement proposal as unfair because it favoured holders of Steinhoff debt.
The case was heard on Friday at a court in Amsterdam, where Steinhoff is registered, during which Lancaster was seeking the termination of the payments proceedings and the adjournment of a meeting at the end of June in which creditors will vote on the settlement proposal.
“During and by the conclusion of the hearing, Lancaster withdrew all of its requests,” Steinhoff said in a statement on Monday. “As a consequence, these requests are no longer pending and do not need to be resolved by the court.”
However, Hamilton BV, a litigation-funding company based in Ireland which seeks more than R16bn on behalf of retail investors, asset managers and pension funds in SA, maintained its challenge that settlement is unfair and inequitable as it gives undue preference to a select group of creditors.
The Amsterdam District Court is due to make an order on the issues raised by Hamilton, which represents fund managers such as Allan Gray, Coronation and Investec, within two weeks from June 4 2021, Steinhoff said. Hamilton is also challenging the proposal in the Western Cape High Court.
Steinhoff said it “will continue its defence against any attempt to disrupt the proposed global settlement”.
Reaching a settlement would close another chapter for Steinhoff after untangling a web of fraudulent transactions that overstated assets and profits, sent its share price crashing and left on the brink of collapse before creditors offered it a lifeline in exchange for a say on a range of issue including how much it could offer to settle lawsuit claims.
It would allow the company to turn its attention to heft its roughly €10bn debt pile, which analysts have said was likely to be paid down to manageable levels through a combination of asset sales and debt-to-equity swaps.
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