South Africa’s Steinhoff has revealed that it is considering making a takeover bid for Poundland.
The move follows recent falls in Poundland’s share price amid weakening sales and disruption caused by its acquisition of 99p Stores. The group’s share price has fallen over 25% this year but rallied yesterday and this morning following news of the takeover approach and reports that private equity owner Warburg Pincus was selling its 15% stake in the business to an unnamed buyer.
Steinhoff already owns Harveys and Bensons for Beds in the UK as well as France-based furniture chain Conforama. It lost out in the takeover battle for the Home Retail Group earlier this year to Sainsbury’s.
In statement issued today, Poundland said it noted the announcement by Steinhoff that it is considering a possible offer for the company. It added: “Poundland shareholders are strongly advised to take no action. The company will issue a further statement if and when appropriate.
“There can be no certainty that a firm offer will be made, nor as to the terms on which any firm offer might be made. This announcement is being made by Poundland without the prior agreement or approval of Steinhoff.”
In accordance with the City Code on takeovers and mergers, Steinhoff has until 5.00pm on 13 July 2016 to announce a firm intention to bid for Poundland.
Poundland is due to announce its full results tomorrow, with analysts predicting a 90% fall in profits as the integration of 99p Stores hampers growth.
- A case of a shopper liking Poundland so much they want to buy the company…?
- Opportunity for suppliers to support via sales driving initiatives to elevate the share price and help preserve its independence?
- Steinhoff determined to enter the UK, so either way, watch this space….