High Street

Poundland owner Steinhoff plea for £176m life raft

The owner of Poundland, Steinhoff, has begun contacting potential lenders in search of €200m (£176m) in “interim liquidity support” to avoid going into administration.

The company was at the centre of an accounting scandal towards the end of last year, and talks include a request for a temporary waiver on current debt obligations, as well as support for its European operations.

The global retail group reported it has already secured 60m (£52m) which should be paid out by today, January 19.

Steinhoff also warned in a financial update that “there can be no assurance that the company will be able to reach agreement with its finance providers on acceptable terms or at all”.

It said: “The company is seeking the necessary approvals and consent for further installments of  the balance. It is expected that any funds so received will be available to meet business critical payments during the next phase of the group’s stabilisation plan.

“The company has also been in recent discussions with several potential funders to provide liquidity facilities to the group, including those who are existing creditors and/or investors in the group.

“To date, additional external liquidity has not been obtained in the time available given the complexity of the Group structure and the terms of the existing financings, although additional external liquidity may be required in the future.”

In December last year group revealed that it would have to reissue its financial results as far back as 2015, due to “accounting irregularities” which ran deeper than first assumed.

Steinhoff has enlisted the PwC to conduct an independent review.

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