Steinhoff USD 584m ABB of PSG more than 3x oversubscribed, driven by local blue-chip investors
23 JAN 2018
Retail group Steinhoff’s [JSE:SNH] placing of 29.5m PSG Group [JSE:PSG] shares by way of an accelerated bookbuild was oversubscribed by more than three times, according to a source close to the situation.
Steinhoff successfully placed the shares at a price of ZAR 240 (USD 19.75) per share, which represents a 5.3% discount to Friday’s (19 January) closing price. Total proceeds amounted to ZAR 7.1bn.
South African investors, including blue chip asset managers, drove demand, said the source, adding that there was also some international support for the offering.
Allocations have a “healthy balance” of long-only investors and hedge funds, with a nice showing from long-term investors, the source said.
The placement was regarded as successful despite a dip in PSG’s share price prior to launch, as the market was expecting Steinhoff to sell down its stake in the investment company, he said. In December, Reuters reported that Steinhoff was contemplating selling its stakes in PSG and industrials group Kap Industrial Holdings [JSE:KAP]. PSG’s stock price went down nearly 20% in the first half of December 2017.
Around the same time last year, beleaguered global retailer Steinhoff International announced plans to raise about EUR 2bn to help finance existing operations and reduce debt.
The block represents 13.5% of PSG’s share capital and around 85% of Steinhoff’s stake in the business.
PSG Capital and Standard Bank were joint bookrunners on the placement.
PSG did not return a request for comment.