Restructuring of the Steinhoff Group
Ever since the accounting irregularities came to light in December 2017, Loyens & Loeff has been acting as Dutch counsel to an ad hoc group of financial creditors (Ad Hoc Group) of Steinhoff International Holding N.V. (Steinhoff) and its subsidiaries (the Steinhoff Group). In 2021 this culminated in the implementation of a Dutch composition plan through a suspension of payments proceedings (surseance van betaling) that settled the litigation claims against the Steinhoff Group and implemented a further financial restructuring following that of 2019.
In late 2022 it became clear that a subsequent restructuring was unavoidable in order to ensure the financial stability of the Steinhoff Group. Loyens & Loeff assisted the Ad Hoc Group in its negotiations with the Steinhoff Group, which resulted in a WHOA restructuring plan that provided for the best possible outcome for the stakeholders involved. Pursuant to the plan, Steinhoff’s debt facilities are extended and transferred to a new orphan holding structure, which will create a stable platform for the controlled disposal of the Steinhoff Group in order to maximise value and allow for the solvent burial of Steinhoff.
The restructuring plan enjoyed overwhelming support of Steinhoff’s creditor groups but was contested by a shareholder. Although out of the money and as such in principle not entitled to receive value, Steinhoff’s shareholders will receive so-called contingent value rights, which will provide them with 20% of any remaining value if and once all of the Steinhoff Group’s debt obligations have been repaid, with the remaining 80% of value being distributed among the external financial creditors of Steinhoff.
Added value Loyens & Loeff
Together with Kirkland & Ellis LLP and Latham & Watkins LLP, Loyens & Loeff acted as counsel to the Ad Hoc Group. We leveraged our experience with cross-border restructurings of complex group structures and intra-group dynamics. Our multi-disciplinary team of restructuring, corporate, capital markets, finance and tax experts was led by Dutch partner Vincent Vroom and senior associate Joris Dunki Jacobs.