7 votes
Little Master
Posted 11 February 2020 - 01:32 PM
Emotions of pain and regret still run deep for investors who lost more than they bargained for when the “darling” of the stock market, Steinhoff came tumbling down like a house of cards.
Renewed interest in Steinhoff’s subsidiary, Pepco Group, has seen the share price rose by over 70% last week as it came to light that private equity investors showed interest.
https://research.eas...impression=true
The Oracle
Posted 10 February 2020 - 11:08 AM
Sage
Posted 08 February 2020 - 08:41 PM
Pump and dump... Profit taking.... Excitement with feb 27 results... Pump on again.. Lets pray base is at 140....the pump can certainly prolong.... And to the point on litigation, any whiff on that and this share will truly fly..... Remeber the pump and dump when restructuring was agreed aug 2018
Share went to 360....with litigation and the turnaround providing direction we could see the share sustain the increase.... To anew base...
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Master
Posted 07 February 2020 - 05:16 PM
I think a lot of people underestimated what happened in SA court yesterday and the day before.
If Steinhoff's application will be granted to consolidate all claims going forward I think Steinhoff has a much bigger chance of solving the matters timely and reducing legal costs.
Current vendor claims are on the table:
Titan (Wiese) 3790 Billion € - relates to Pepkor claims
Owners of Tekkie Town 0.26 Billion €
Wiesfam 0.22 Billion € PSG shares
GT Feirrera 0.075 Billion PSG shares
Le Toit 0.048 Billion PSG Shares
Greyling 0.006 Billion PSG shares
Lancaster 0.719 Billion €
LSW 0.33 Billion €
So total Vendor claims amount to 5.448 Billion €
It will be very interesting to see what will happen here regarding a possible settlement. For me the vendor claims can make or brake Steinhoff. Here however I see other parties involved who might be liable to share settlements. Deloite, Deutsche bank etc. . .
Shareholder claims still needs to be quantified.
We had a deadline in Germany for every shareholder to raise their claims until the 5 of Feb 2020. Will be interesting to see how big it will be.
My best guess is that the total of all shareholder claims will range between 4 and 8 Billion €
Here Steinhoff said they would settle for a value of 20% of Pepkor shares. Value would be around 0.8 Billion €
Other legal matters
FSCA fine- Penalty imposed was 0.1 Billion € - Steinhoff only needs to settle 0.004 Billion € which is 4% of the total imposed
Hope Steinhoff will update the market soon regarding the individual claims.
Member
Posted 07 February 2020 - 03:53 PM
Is there a chance that q1 results may require an earlier sens update if the growth exceeds previous year by 15%...and would would this be announced.
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At least I recouperated some of my losses by holding on...still holding 
Master
Posted 07 February 2020 - 03:50 PM
Is there a chance that q1 results may require an earlier sens update if the growth exceeds previous year by 15%...and would would this be announced.
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For Q1 update no such requirements exists. Only for HY and full year results.
The Oracle
Posted 07 February 2020 - 01:39 PM
Pump and dump... Profit taking.... Excitement with feb 27 results... Pump on again.. Lets pray base is at 140....the pump can certainly prolong.... And to the point on litigation, any whiff on that and this share will truly fly..... Remeber the pump and dump when restructuring was agreed aug 2018
Share went to 360....with litigation and the turnaround providing direction we could see the share sustain the increase.... To anew base...
Sent from my SM-G950F using Sharenet Sharechat mobile app
The Oracle
Posted 07 February 2020 - 11:53 AM
Sage
Posted 07 February 2020 - 11:25 AM
The Oracle
Posted 07 February 2020 - 11:17 AM
120-135What do you guys think would be a good price to jump in at?
Advanced Member
Posted 07 February 2020 - 10:36 AM
It has retraced a lot. Should start moving up with news about litigation that will be acceptable for everyone.
Member
Posted 07 February 2020 - 10:18 AM
Sage
Posted 07 February 2020 - 10:01 AM
Day 3....lets see how market plays it
Member
Posted 07 February 2020 - 08:43 AM
Edited by woolhoff, 07 February 2020 - 08:44 AM.
Member
Posted 07 February 2020 - 08:42 AM
Sage
Posted 07 February 2020 - 08:25 AM
Member
Posted 06 February 2020 - 03:48 PM
Thanks all for the input... Good read... So on arbitrary share price movement... We have a base... Or what seems to be a base forming at 140 vs 85c...should set fot a nice pump through to end feb with q1......... Not intellectually determined...
Is this a good buy opportunity.... My greedy nature thinks yes.... Its also my stupid speculative ego
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Call on the "intelligent investor" from within I am reading the book right now!
The Oracle
Posted 06 February 2020 - 03:44 PM
Master
Posted 06 February 2020 - 01:07 PM
Thanks! So, we wait some more.
Hi Bubble,
I did some high level calcs to compare the situation of IPO 29% of Pepco Group and selling all of Pepco. Very interesting outcome and hopefully management will get to the same conclusion:
Looking at Dec 2021 - Situation of an IPO (71%) Situation of Selling Group (0%)
Debt levels as at Dec 2021 11.5 11.5
Unitrans sale -0.5 -0.5
Hemisphere prop -0.8 -0.8
Greenlit -0.5 -0.5
EBITDA for 3 years -2.5 -1.7
IPO / Sale proceeds -1.4 -4.5
Total debt to be refinanced Dec 2021 5.8 3.5
Now looking at the SUM Parts value as at Dec 2021:
Pepkor SA (71%) 4.8 4.8
Pepco Group (71%) vs (0%) 4.2 0
Confo (50%) 1.1 1.1
Greenlit (50%) 0.2 0.2
Mattress (49%) 1.2 1.2
Total SUM PV Dec 2021 11.5 7.3
Total Value left: 5.7 3.8
There one can clearly see that an IPO would be way more beneficial. The difference will be 1.9 Billion on a high level
Going forward they could refinance at 4% average interest. That would mean the following in 2022 on the income statement:
Interest on remaining debt as at Dec 2021 @ 4% -0.25 -0.15
Expected EBITDA Pepco Group 2022 (71%) 0.31 0
Total 0.06 -0.15
Again one can see that IPO is the better solution. Steinhoff needs to obtain at least around 6.5 Billion for the Pepco Group to sell the whole group.
Assumption:
Debt levels at operational levels not considered
Current cash held by group not considered
Legal claims not considered
Once off costs not considered
Again this is my personal opinion and no recommendation for buying or selling Steinhoff shares.
Advanced Member
Posted 06 February 2020 - 12:00 PM
Hi Bubble, I still hope that Pepco is not sold as a whole group. I rather hope that all this hype regarding the bids and price etc will help at the IPO of Pepco Group. I mean they have done so much in the background to prepare for a listing why now sell the whole group?
Yes it would be beneficial to get the 4.5 Billion euro now but that wouldn't help Steinhoff at all. They would be sitting on a huge cash balance until end of Dec 2021 when they are allowed to repay the debt. I thus hope they IPO around 25-30% now and if they really need cash they could raise this by an accelerated book build closer to the Dec 2021 by selling off more.
As seen with Pepkor dividends they do not want more cash at the moment, thus they have opted for the scrip dividends. I think that they will sell off these additional scrip dividends shares closer to the end of 2021.
I have posted my prediction back in August with the possible NAV for Jan 2022:
I think management is following this plan. I wrote this up beginning of August last year. I now added in blue what happened so far:
"So I personally think the following will happen until the end of 2021:
Net debt lies at 9,1 Billion @ 10% p.a. for 3 years we will sit at around 11.5 Billion debt at the end of Dez 2021. No change yet
I think selling Unitrans will bring 500 Million - Unitrans sold - Proceeds not released yet
Selling the Hemisphere properties another 800 Million - Can't find much info on this. However I think they where sold
EBITDA from the operating entities for 3 years: 2,5 Billion (Assuming they keep 71% of Pepkor Europe) - 2019 to be release soon (However expecting about 900 Million EBITDA excl. MF). This might even be higher
Selling Greenlit 500 Million - Half of Greenlit sold, I'm expecting an announcement soon that other half will be sold off as well. Proceeds not yet released - Possible IPO of remaining unit - 1 Billion Dollar was mentioned in an article
IPO Pepkor Europe and sell 29% will bring 1,2 Billion - This will happen at the end of this year, hope they will not IPO more then 29%. Now IPO of 29% would lead to 1.4 Billion €
Other- Can't give an exact number but might bring some Euros. Smaller sales where made, however I have no amounts
So taking all these steps Steinhoff would sit at 6 Billion debt by the end of 2021. Which would be refinanced by way better terms given the SUM of Parts value. I still think that 6 Billion debt is sustainable for Steinhoff in the long run at reasonable interest rates
By 2021 I would think that the businesses have the following Value: (Valuation is based on different EBITDA multiples)
Pepkor EU: 3,2 Billion (71%) I see this at 4 Billion now already
STAR: 4 Billion (71%)
Confo: 1 Billion (45%)
Mattress: 1.1 Billion (45%)
Greenlit : IPO of 0,7 Billion possible?
Total SUM-PARTS VALUE of Steinhoff holdings = 9,3 Billion. I still see this as reasonable for the end of 2021. Given the new information I would see this at 10.8 Billion €
So at the end of 2021 they would have a serious good asset base to get cheaper loans.
Biggest Issue are the legal claims which are the main focus now from management so hopefully we won'T see too many settlements and if there are settlements that these are shared between auditors banks etc.
Here I hope a solution will be found in due course. Hopefully the white knight refers to a thrid party which will also be liable to settle any claims. (Banks, auditors, advisers etc.) I still do believe tho that the total claim will lie around 0.5 and 1 Billion € for Steinhoff.
Even though we haven't heard anything new since November 2019 from management. One can see there is substantial progress being made at all levels.
The above is just my opinion and no recommendation to buy or sell Steinhoff shares.
That is my latest opinion on Steinhoff.
Thanks! So, we wait some more.
