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Retail

Steinhoff's Insurers Agree To Pay $93m To Settle Certain Claims

Steinhoff said on Tuesday it has reached an agreement with certain insurance companies underwriting the group's directors and officers insurance policy to contribute up to €78.1 million ($93 million) to help settle claims against it.

The move takes the retailer a step closer to a proposed $1 billion global lawsuit settlement plan announced in July to settle about 90 separate legal claims in the Netherlands, Germany and South Africa.

The combined claims of those who have quantified their alleged damages are in excess of 136 billion rand ($9 billion) after an accounting fraud in December 2017 resulted in a dramatic share price plunge of Steinhoff.

As part of the agreement, also with Steinhoff's certain former directors and officers (D&Os) such as founder Bruno Steinhoff and former chair Christo Wiese, the insurers will offer an amount of up to €55.5 million to market-purchase claimants 'in exchange for certain waivers and releases'.

The furniture and clothing retailer said €15 million would be paid to certain contractual claimants.

Terms Of Agreement

The agreement with directors and officers excludes former CEO Markus Jooste, former CFO Ben La Grange, former secretary Stehan Grobler and the group's ex-Steinhoff Europe director Siegmar Schmidt, it said.

Steinhoff said it maintains the right to institute or continue claims against the four for their alleged involvement in the fraud and against certain legal entities and other individuals said to have received payments by the group's companies.

The agreement will be in addition to that of its former auditor Deloitte, which agreed in February to support the plan and pay up to €77.94 million to settle some claims.

"Deloitte, the D&O insurers and the settling D&Os do not in any way admit liability for the losses incurred by Steinhoff and its stakeholders as a result of the accounting irregularities at Steinhoff," the company said.

News by Reuters, edited by ESM. Click subscribe to sign up to ESM: European Supermarket Magazine.

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