NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN, INTO OR
FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE
RELEVANT LAWS OF SUCH JURISDICTION
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
13 July 2016
RECOMMENDED CASH OFFER
for
Poundland Group PLC
by
Steinhoff Europe AG
to be effected
by way of a Scheme of Arrangement
under Part 26 of the Companies Act 2006
Summary

The boards of Steinhoff International Holdings N.V. (“Steinhoff”) and Poundland Group PLC
(“Poundland”) are pleased to announce that they have reached agreement on the terms of
a recommended cash offer pursuant to which Steinhoff Europe AG (“SEAG”) or a whollyowned subsidiary of SEAG (with the support of its ultimate parent company, Steinhoff) shall
acquire the entire issued and to be issued share capital of Poundland not already directly or
indirectly owned by it (the “Offer”).

Each Poundland Shareholder shall be entitled to receive 222 pence in cash for each
Poundland Share held (the “Cash Value”), comprising:

under the terms of the Offer, 220 pence in cash for each Poundland Share held by
each Poundland Shareholder (the “Offer Price”); and

the final dividend of two pence per Poundland Share announced in the Poundland
results announcement for the year ended 27 March 2016, dated 16 June 2016 (the
“Agreed Dividend”), which will be paid on 23 September 2016 to holders of
Poundland Shares whose names are on the register at the close of business on
9 September 2016,
valuing the entire issued and to be issued share capital of Poundland at approximately £597
million on a fully diluted basis.


The Cash Value of 222 pence in cash represents a premium of approximately:

40.3 per cent. to the Closing Price per Poundland Share of 158.25 pence on
13 June 2016 (being the last Business Day prior to the first acquisition of Poundland
Shares by SEAG); and

13.3 per cent. to the Closing Price per Poundland Share of 196 pence on 12 July
2016 (being the latest practicable date prior to publication of this Announcement).
The Offer Price of 220 pence represents a premium of approximately 39.0 per cent. to the
Closing Price per Poundland Share of 158.25 pence on 13 June 2016 (being the Business
Day prior to the first acquisition of Poundland Shares by SEAG).
1

It is intended that the Offer will be implemented by way of a Court-sanctioned scheme of
arrangement under Part 26 of the Companies Act (or, if SEAG elects, with the consent of the
Panel, a takeover offer under Part 28 of the Companies Act).

The Poundland Directors, who have been so advised by J.P. Morgan Cazenove and
Rothschild as to the financial terms of the Offer, consider the terms of the Offer to be
fair and reasonable. In providing advice to the Poundland Directors, J.P. Morgan
Cazenove and Rothschild have taken into account the commercial assessments of
the Poundland Directors. Rothschild is providing independent financial advice to the
Poundland Directors for the purposes of Rule 3 of the Takeover Code.

Accordingly, the Poundland Directors intend to recommend unanimously that
Poundland Shareholders vote in favour of the Scheme at the Court Meeting and the
resolutions to be proposed at the General Meeting as the Poundland Directors who
hold Poundland Shares have irrevocably undertaken to do (in their personal capacity)
in respect of their own beneficial holdings (or those they otherwise control the
exercise of) of 14,719,261 Poundland Shares, representing approximately 5.5 per
cent. of the share capital of Poundland in issue on 12 July 2016 (being the latest
practicable date prior to the date of publication of this Announcement).

As at 12 July (being the latest practicable date prior to publication of this Announcement)
SEAG was directly interested in 63,473,352 Poundland Shares, representing approximately
23.6 per cent. of Poundland’s issued share capital. SEAG has undertaken in the Cooperation Agreement to vote in favour of the resolutions to be proposed at the General
Meeting in respect of its entire beneficial holding of Poundland Shares (but SEAG will not be
permitted to vote at the Court Meeting).
Taking into account the irrevocable undertakings from the Poundland Directors and Canada
Life Investments, Steinhoff has therefore received irrevocable undertakings to vote in favour
of (i) the Scheme at the Court Meeting representing, in aggregate, approximately 9 per cent.
of Poundland Shares held by holders eligible to vote at the Court Meeting and (ii) the
resolutions to be proposed at the General Meeting representing, in aggregate,
approximately 7 per cent. of Poundland’s issued share capital and, (for purposes of the
General Meeting only) when aggregated with the Poundland Shares that Steinhoff already
holds (through SEAG), 30.6 per cent. of the Poundland share capital in issue, in each case
on 12 July 2016 (being the latest practicable date prior to publication of this Announcement).
Further details of these irrevocable undertakings are set out in Appendix III to this
Announcement.

The Offer shall be put to Poundland Shareholders at the Court Meeting and at the General
Meeting. In order to become Effective, the Scheme must be approved by a majority in
number of the Poundland Shareholders voting at the Court Meeting, either in person or by
proxy, representing at least 75 per cent. in value of the Poundland Shares voted (in both
cases excluding SEAG who will not be permitted to vote at the Court Meeting). In addition, a
special resolution implementing the Scheme must be passed by holders of Poundland
Shares representing at least 75 per cent. of votes cast at the General Meeting, either in
person or by proxy (including SEAG who will be permitted to vote at the General Meeting).

The Scheme Document, containing further information about the Offer and notices of the
Court Meeting and the General Meeting shall be published as soon as practicable and, in
any event, within 28 days of this Announcement, unless SEAG and Poundland otherwise
agree, and the Takeover Panel consents, to a later date. Subject to the Conditions and
2
certain further terms set out in Appendix I to this Announcement, the Offer is expected to
become Effective by mid-September 2016. The Scheme Document will contain an expected
timetable for the Offer process.
Commenting on the Offer, Darren Shapland, Chairman of Poundland, said:
“The Poundland Board believes that SEAG’s all-cash offer presents Poundland shareholders with
an opportunity to realise their shareholding at a certain and attractive price, securing earlier
delivery of the Poundland Group’s medium term value than could be expected from the ongoing
turnaround process against a background of increasing economic uncertainty in the UK and a
more challenging trading environment.
The single-price sector has undergone significant modernisation and professionalisation in recent
years and is now a mainstream feature of UK retail. Through the hard work and dedication of our
many thousands of talented colleagues, Poundland has played a pivotal role in that
transformation. Steinhoff is a well-capitalised, international business with a clear and proven
commitment to value retailing. They share our vision for the growth and expansion of Poundland
and, as such, we believe they are a suitable and appropriate partner for our colleagues, our
suppliers and stakeholders.”
Commenting on the Offer, Markus Jooste, CEO of Steinhoff, said:
“The Board of Steinhoff and its management team are enthusiastic about the opportunities that
this transaction brings: we believe that there is significant merit in bringing Poundland into
Steinhoff’s global network. Steinhoff is developing a fast-growing, price-led retail business across
the UK and the rest of Europe. Poundland would be a complementary fit to this growth story.
Steinhoff recognises the strength and value of the Poundland management team and anticipates
that they will play a key role in the ongoing growth and development of Poundland as part of the
Steinhoff group. We look forward to welcoming Poundland employees to be part of one of
Europe’s leading multi-format discount retailers.”
This summary should be read in conjunction with, and is subject to, the full text of this
Announcement (including its Appendices). The Offer shall be subject to the Conditions and
further terms set out in Appendix I to this Announcement and to the full terms and
conditions which shall be set out in the Scheme Document. Appendix II to this
Announcement contains the sources of information and bases of calculations of certain
information contained in this Announcement, Appendix III contains a summary of the
irrevocable undertakings received in relation to this Offer and Appendix IV contains
definitions of certain expressions used in this summary and in this Announcement.
Further Information
Linklaters LLP are providing legal advice to Steinhoff and SEAG. Freshfields Bruckhaus Deringer
LLP are providing legal advice to Poundland.
Enquiries
Steinhoff and SEAG
Tel: +27 (0)21 808 0711
Mariza Nel, Director, Corporate Services (Investor Relations)
Nick Agarwal (UK Press)
Tel: +44 (0)75 6810 1045
Investec Bank plc (financial adviser to Steinhoff and SEAG)
Tel: +44 (0)20 7597 4000
Andrew Pinder / David Anderson
3
Sara Hale / Henry Reast (Corporate Broking)
Poundland
Darren Shapland, Chairman
Tel: +44 (0)12 1526 8688
Philip Dorgan, Head of Investor Relations
Tel: +44 (0)12 1568 7000
J.P. Morgan Cazenove (joint financial adviser and corporate
broker to Poundland)
Tel: +44 (0) 20 7742 4000
Toby Radford / Caroline Thomlinson
Mark Breuer / James Robinson
Rothschild (joint financial adviser to Poundland)
Tel: +44 (0) 20 7280 5000
Majid Ishaq
John Byrne
Shore Capital (corporate broker to Poundland)
Tel: +44 (0) 20 7408 4050
Dru Danford
Patrick Castle
Citigate Dewe Rogerson (PR adviser to Poundland)
Simon Rigby
Tel: +44 (0) 20 7282 2847
Kevin Smith
Tel: +44 (0) 20 7282 1054
Nick Hayns
Tel: +44 (0) 20 7282 1032
Important Notices
Investec Bank plc is authorised by the Prudential Regulation Authority and regulated by the
Financial Conduct Authority and the Prudential Regulation Authority in the UK. Investec Bank plc is
acting exclusively as financial adviser to Steinhoff and SEAG and no one else in connection with
the Offer and shall not be responsible to anyone other than Steinhoff and SEAG for providing the
protections afforded to clients of Investec Bank plc nor for providing advice in connection with the
Offer or any matter referred to herein.
J.P. Morgan Limited, which conducts its UK investment banking business as J.P. Morgan
Cazenove ("J.P. Morgan Cazenove"), is authorised and regulated in the United Kingdom by the
Financial Conduct Authority. J.P. Morgan Cazenove is acting as financial adviser exclusively for
Poundland and no one else in connection with the matters set out in this Announcement and will
not regard any other person as its client in relation to the matters in this Announcement and will
not be responsible to anyone other than Poundland for providing the protections afforded to clients
of J.P. Morgan Cazenove, nor for providing advice in relation to any matter referred to herein.
N. M. Rothschild & Sons Limited, which is authorised by the Prudential Regulation Authority and
regulated by the FCA and the Prudential Regulation Authority in the United Kingdom, is acting
exclusively for Poundland and no one else in connection with the Offer and will not be responsible
to anyone other than Poundland for providing the protections afforded to its clients or for providing
advice in relation to the Offer or any other matters referred to in this Announcement.
Shore Capital Stockbrokers Limited (“Shore Capital”) which is authorised and regulated in the
United Kingdom by the Financial Conduct Authority is acting as corporate broker to Poundland and
4
no one else in connection with the Offer and other matters described in this Announcement and
will not be responsible to anyone other than Poundland for providing the protections afforded to
clients of Shore Capital or for providing advice in relation to the Offer and other matters described
in this Announcement.
This Announcement is for information purposes only and does not constitute an offer to sell or an
invitation to purchase any securities or the solicitation of an offer to buy any securities, pursuant to
the Offer or otherwise. The Offer shall be made solely by means of the Scheme Document or any
document by which the Offer is made which shall contain the full terms and Conditions of the Offer,
including details of how to vote in respect of the acquisition.
This Announcement has been prepared for the purpose of complying with English law and the
Takeover Code and the information disclosed may not be the same as that which would have been
disclosed if this Announcement had been prepared in accordance with the laws of jurisdictions
outside the United Kingdom.
Poundland shall prepare the Scheme Document to be distributed to holders of Poundland Shares.
Poundland, SEAG and Steinhoff urge Poundland Shareholders to read the Scheme Document
when it becomes available because it shall contain important information relating to the Offer.
This Announcement does not constitute a prospectus or prospectus equivalent document.
Overseas Shareholders
The release, publication or distribution of this Announcement in certain jurisdictions may be
restricted by law. Persons who are not resident in the United Kingdom or who are subject to other
jurisdictions should inform themselves of, and observe, any applicable requirements.
The Offer relates to shares of a UK company and is proposed to be effected by means of a
scheme of arrangement under the laws of England and Wales. A transaction effected by means of
a scheme of arrangement is not subject to proxy solicitation or tender offer rules under the US
Securities Exchange Act of 1934 (the “US Exchange Act”). Accordingly, the Offer is subject to the
disclosure requirements, rules and practices applicable in the United Kingdom to schemes of
arrangement, which differ from the requirements of US proxy solicitation or tender offer rules.
However, if SEAG were to elect to implement the Offer by means of a takeover offer in the
circumstances provided for in this Announcement, such takeover offer shall be made in
compliance with all applicable laws and regulations, including Section 14(e) of the US Exchange
Act and Regulation 14E thereunder. Such a takeover would be made in the United States by
SEAG and no one else. In addition to any such takeover offer, SEAG, certain affiliated companies
and the nominees or brokers (acting as agents) may make certain purchases of, or arrangements
to purchase, shares in Poundland outside such takeover offer during the period in which such
takeover offer would remain open for acceptance. If such purchases or arrangements to purchase
were to be made they would be made outside the United States and would comply with applicable
law, including the US Exchange Act.
Unless otherwise determined by SEAG or required by the Takeover Code, and permitted by
applicable law and regulation, the Offer shall not be made available, directly or indirectly, in, into or
from a Restricted Jurisdiction where to do so would violate the laws in that jurisdiction and no
person may vote in favour of the offer by any such use, means, instrumentality or form within a
Restricted Jurisdiction or any other jurisdiction if to do so would constitute a violation of the laws of
that jurisdiction. Accordingly, copies of this Announcement and all documents relating to the Offer
are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or
sent in, into or from a Restricted Jurisdiction where to do so would violate the laws in that
5
jurisdiction, and persons receiving this Announcement and all documents relating to the Offer
(including custodians, nominees and trustees) must not mail or otherwise distribute or send them
in, into or from such jurisdictions where to do so would violate the laws in that jurisdiction.
The availability of the Offer to Poundland Shareholders who are not resident in the United
Kingdom may be affected by the laws of the relevant jurisdictions in which they are resident.
Persons who are not resident in the United Kingdom should inform themselves of, and observe,
any applicable requirements.
The Offer shall be subject to the applicable requirements of the Takeover Code, the Panel, the
London Stock Exchange, the Financial Conduct Authority and the UKLA.
Forward Looking Statements
This Announcement contains statements about Steinhoff, SEAG and Poundland that are or may
be forward looking statements. All statements other than statements of historical facts included in
this Announcement may be forward looking statements. Without limitation, any statements
preceded or followed by or that include the words “targets”, “plans”, “believes”, “expects”, “aims”,
“intends”, “will”, “may”, “anticipates”, “estimates”, “projects” or words or terms of similar substance
or the negative thereof, are forward looking statements. Forward looking statements include
statements relating to the following: (i) future capital expenditures, expenses, revenues, earnings,
synergies, economic performance, indebtedness, financial condition, dividend policy, losses and
future prospects; (ii) business and management strategies and the expansion and growth of
Steinhoff’s or Poundland’s operations and potential synergies resulting from the Offer; and (iii) the
effects of government regulation on Steinhoff’s or Poundland’s business.
Such forward looking statements involve risks and uncertainties that could significantly affect
expected results and are based on certain key assumptions. Many factors could cause actual
results to differ materially from those projected or implied in any forward looking statements. Due
to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward
looking statements, which speak only as of the date hereof. Each of Steinhoff, SEAG and
Poundland disclaims any obligation to update any forward looking or other statements contained
herein, except as required by applicable law.
No profit forecasts or estimates
No statement in this Announcement is intended as a profit forecast or estimate for any period and
no statement in this Announcement should be interpreted to mean that earnings or earnings per
share for Steinhoff or Poundland, as appropriate, for the current or future financial years would
necessarily match or exceed the historical published earnings or earnings per share for Steinhoff
or Poundland, as appropriate.
Disclosure requirements of the Takeover Code
Under Rule 8.3(a) of the Takeover Code, any person who is interested in 1 per cent. or more of
any class of relevant securities of an offeree company or of any securities exchange offeror (being
any offeror other than an offeror in respect of which it has been announced that its offer is, or is
likely to be, solely in cash) must make an Opening Position Disclosure following the
commencement of the Offer Period and, if later, following the announcement in which any
securities exchange offeror is first identified. An Opening Position Disclosure must contain details
of the person’s interests and short positions in, and rights to subscribe for, any relevant securities
of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position
Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm
(London time) on the 10th Business Day following the commencement of the Offer Period and, if
appropriate, by no later than 3.30 pm (London time) on the 10th Business Day following the
6
announcement in which any securities exchange offeror is first identified. Relevant persons who
deal in the relevant securities of the offeree company or of a securities exchange offeror prior to
the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.
Under Rule 8.3(b) of the Takeover Code, any person who is, or becomes, interested in 1 per cent.
or more of any class of relevant securities of the offeree company or of any securities exchange
offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree
company or of any securities exchange offeror. A Dealing Disclosure must contain details of the
dealing concerned and of the person’s interests and short positions in, and rights to subscribe for,
any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror,
save to the extent that these details have previously been disclosed under Rule 8. A Dealing
Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm
(London time) on the Business Day following the date of the relevant dealing.
If two or more persons act together pursuant to an agreement or understanding, whether formal or
informal, to acquire or control an interest in relevant securities of an offeree company or a
securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree company and by any offeror and
Dealing Disclosures must also be made by the offeree company, by any offeror and by any
persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).
Details of the offeree and offeror companies in respect of whose relevant securities Opening
Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table
on the Panel’s website at http://www.thetakeoverpanel.org.uk/, including details of the number of
relevant securities in issue, when the Offer Period commenced and when any offeror was first
identified. If you are in any doubt as to whether you are required to make an Opening Position
Disclosure or a Dealing Disclosure, you should contact the Panel’s Market Surveillance Unit on
+44 (0)20 7638 0129.
Publication on Website and Availability of Hard Copies
A copy of this Announcement shall be made available subject to certain restrictions relating to
persons resident in Restricted Jurisdictions on Steinhoff’s and Poundland’s websites at
www.steinhoffinternational.com and www.poundlandcorporate.com respectively by no later than 12
noon (London time) on 14 July 2016. For the avoidance of doubt, the contents of the websites
referred to in this Announcement are not incorporated into and not do form part of this
Announcement.
You may request a hard copy of this Announcement by:

for Steinhoff shareholders, contacting the Company Secretary at Steinhoff UK Holdings
th
Limited, 5 Floor Festival House, Jessop Avenue, Cheltenham, Gloucestershire, GL50
3SH, United Kingdom. Telephone number: +44 (0) 1242 586360; or

for Poundland Shareholders, by writing to Poundland’s registrar at Computershare, The
Pavilions, Bridgwater Road, Bristol BS13 8AE or by calling them on 0370 707 1028 from
within the UK or on +44 (0)370 707 1028 if calling from outside the UK.
You may also request that all future documents, announcements and information to be sent to you
in relation to the Offer should be in hard copy form.
Rounding
7
Certain figures included in this Announcement have been subjected to rounding adjustments.
Accordingly, figures shown for the same category presented in different tables may vary slightly
and figures shown as totals in certain tables may not be an arithmetic aggregation of the figures
that precede them.
8
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN, INTO OR
FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE
RELEVANT LAWS OF SUCH JURISDICTION
13 July 2016
RECOMMENDED CASH OFFER
for
Poundland Group PLC
by
Steinhoff Europe AG
to be effected
by way of a Scheme of Arrangement
under Part 26 of the Companies Act 2006
1
Introduction
The boards of Steinhoff and Poundland are pleased to announce that they have reached
agreement on the terms of a recommended cash offer pursuant to which SEAG or a whollyowned subsidiary of SEAG (with the support of its ultimate parent Company, Steinhoff) shall
acquire the entire issued and to be issued share capital of Poundland not already directly or
indirectly owned by it. As at 12 July 2016 (being the latest practicable date prior to
publication of this Announcement) SEAG was directly interested in 63,473,352 Poundland
Shares, representing approximately 23.6 per cent. of Poundland’s issued share capital.
It is intended that the Offer is to be effected by means of a Court-sanctioned scheme of
arrangement under Part 26 of the Companies Act.
2
The Offer
Under the terms of the Offer, which shall be subject to the Conditions and further terms set
out in Appendix I to this Announcement and to be set out in the Scheme Document, each
Poundland Shareholder shall be entitled to receive:
for each Poundland Share
220 pence in cash
The Offer, together with the Agreed Dividend, values the entire issued share capital of
Poundland at approximately £597 million on a fully diluted basis.
The Agreed Dividend of two pence per Poundland Share was announced in the Poundland
results announcement for the year ended 27 March 2016, dated 16 June 2016, and will be
paid on 23 September 2016 to holders of Poundland Shares whose names are on the
register at the close of business on 9 September 2016.
The Cash Value of 222 pence in cash (being the aggregate of the Offer Price and the
Agreed Dividend) represents a premium of approximately:

40.3 per cent. to the Closing Price per Poundland Share of 158.25 pence on 13
June 2016 (being the last Business Day prior to the first acquisition of Poundland
Shares by SEAG); and

13.3 per cent. to the Closing Price per Poundland Share of 196 pence on 12 July
2016 (being the latest practicable date prior to publication of this Announcement).
9
The Offer Price of 220 pence represents a premium of approximately 39.0 per cent. to the
Closing Price per Poundland Share of 158.25 pence on 13 June 2016 (being the Business
Day prior to the first acquisition of Poundland Shares by SEAG).
It is currently expected that the Scheme Document shall be published in early August, that
the Court Meeting and the General Meeting shall be held on 7 September 2016 and that the
Scheme shall become Effective by mid-September 2016.
3
Background to and reasons for the Offer
Steinhoff has a proven track record of acquiring and successfully integrating relevant
companies and their brands into its network of retail companies supported by an efficient
integrated supply chain in Europe, Africa and the Pacific Rim.
Steinhoff is developing a fast-growing, price-led retail business across the UK and the rest
of Europe. Steinhoff believes the Poundland business will be an attractive addition to its
existing multi-format discount retail business, and accelerate the group’s customer
proposition and growth dynamics.
4
Background to and reasons for the recommendation
The Poundland Board believes that SEAG’s all-cash offer provides Poundland’s
shareholders with the opportunity to realise their shareholding at an attractive price and at a
significant premium to Poundland’s undisturbed share price.
The past year has been both challenging and transformative for Poundland. The acquisition
of 99p Stores strengthened Poundland’s position as Europe’s biggest single-price
discounter and positions it well for the long term, but also placed significant strain on the
core business. The conversion of 99p Stores to the Poundland fascia was completed ahead
of schedule, but was more capital intensive and needed more attention from management
than expected. Also, as Poundland has reported over the past year, the impact of increased
competition, falling high street footfall, and changing consumer shopping behaviour have
impacted performance.
When considering the Offer, the Poundland Directors have taken into account the current
market conditions, including the short term and long term challenges and opportunities for
the business, and the likely time required for Poundland to improve performance and
achieve its strategy. In addition, the UK’s decision to leave the EU has increased short term
uncertainty. The Poundland Directors have also considered the benefits that being part of a
larger diversified retail group would bring to the Poundland business.
The Poundland Directors considered the Offer with regard to price, deliverability and with
reference to the range of other strategic options available to Poundland. In particular, the
Poundland Directors have evaluated the terms of the Offer in relation to the prospects of the
business and the potential medium term standalone value of Poundland Shares. The
Poundland Directors have also considered the interests of Poundland employees,
customers and other stakeholders in addition to the economic benefits to Poundland
Shareholders.
The Poundland Board believes that Steinhoff is a strong, well-capitalised partner which can
continue to develop the Poundland business. Steinhoff provides Poundland with significantly
greater access to broader and deeper capital resources and global synergies. The
Poundland Board expects that Steinhoff will be able to accelerate Poundland’s strategy by
10
expanding its routes to market and exploiting the greater scale and reach of Steinhoff’s
operations.
Following careful consideration of the above factors, the Poundland Board believes that the
Offer reflects an attractive price for the business and provides certainty, in cash, to
Poundland Shareholders today.
5
Recommendation
Following careful consideration of the above factors, the Poundland Directors, who
have been so advised by J.P. Morgan Cazenove and Rothschild as to the financial
terms of the Offer, consider the terms of the Offer to be fair and reasonable. In
providing advice to the Poundland Directors, J.P. Morgan Cazenove and Rothschild
have taken into account the commercial assessments of the Poundland Directors.
Rothschild is providing independent financial advice to the Poundland Directors for
the purposes of Rule 3 of the Takeover Code.
Accordingly, the Poundland Directors intend to recommend unanimously that
Poundland Shareholders vote in favour of the Scheme at the Court Meeting and the
resolutions to be proposed at the General Meeting, as the Poundland Directors who
hold Poundland Shares have irrevocably undertaken to do (in their personal capacity)
in respect of their own beneficial holdings (or those they otherwise control the
exercise of) of 14,719,261 Poundland Shares, representing approximately 5.5 per
cent. of the share capital of Poundland in issue on 12 July 2016 (being the latest
practicable date prior to the date of publication of this Announcement).
6
Irrevocable undertakings
Steinhoff has received irrevocable undertakings from each of the Poundland Directors to
vote in favour of the Scheme at the Court Meeting and the resolutions to be proposed at the
General Meeting, in respect of a total of 14,719,261 Poundland Shares, representing
approximately 5.5 per cent. of the share capital of Poundland in issue on 12 July 2016
(being the latest practicable date prior to publication of this Announcement). These
irrevocable undertakings remain binding in the event of a competing offer. Further details of
these irrevocable undertakings (including the circumstances in which they shall fall away)
are set out in Appendix III to this Announcement.
Steinhoff has also received an irrevocable undertaking to vote in favour of the Scheme at
the Court Meeting and the resolutions to be proposed at the General Meeting from Canada
Life Investments in respect of a total of 4,075,404 Poundland Shares representing, in
aggregate, approximately 2 per cent. of Poundland Shares held by holders eligible to vote at
the Court Meeting and approximately 1.5 per cent. of Poundland’s issued share capital.
Further details of these irrevocable undertakings are set out in Appendix III to this
Announcement.
SEAG has also undertaken in the Co-operation Agreement to vote in favour of the
resolutions proposed at the General Meeting in respect of its entire beneficial holding of
Poundland Shares being 63,473,352 Poundland Shares, representing approximately 23.6
per cent. of Poundland’s issued share capital. SEAG is not permitted to vote on the Scheme
at the Court Meeting.
11
Taking into account the irrevocable undertakings from the Poundland Directors and Canada
Life Investments, Steinhoff has therefore received irrevocable undertakings to vote in favour
of (i) the Scheme at the Court Meeting representing, in aggregate, approximately 9 per cent.
of Poundland Shares held by holders eligible to vote at the Court Meeting and (ii) the
resolutions to be proposed at the General Meeting representing, in aggregate,
approximately 7 per cent. of Poundland’s issued share capital and, (for purposes of the
General Meeting only) when aggregated with the Poundland Shares that Steinhoff already
holds (through SEAG), 30.6 per cent. of the Poundland share capital in issue, in each case
on 12 July 2016 (being the latest practicable date prior to publication of this Announcement).
7
Information on Steinhoff and SEAG
Steinhoff is an integrated retailer that manufactures, sources and retails furniture, household
goods and general merchandise in Europe, Africa and Australasia. Steinhoff’s vertically
integrated business model is based upon a strategy of sourcing and manufacturing products
at low cost and distributing them to its value-conscious customer base through its extensive
retail footprint.
Steinhoff’s integrated retail divisions comprise of:

Household goods comprising furniture and homeware retail businesses;

General Merchandise focusing on clothing and footwear, accessories and
homeware; and

Automotive dealerships in South Africa which provide vehicles, parts, insurance,
accessories and servicing.
Steinhoff has a primary listing on the Frankfurt Stock Exchange and a secondary listing on
the Johannesburg Stock Exchange and as at 12 July 2016 (being the latest practicable date
prior to publication of this Announcement) has a market capitalisation of approximately
€21 billion. Steinhoff reported revenue and operating profit for the nine-months ended 31
March 2016 of €9.9 billion and €1.1 billion respectively, and employs approximately 105,000
people.
Steinhoff, through SEAG as its wholly owned subsidiary, is a holding company invested
predominantly in household goods and diversified related industries with interests in the
United Kingdom, Continental Europe, and the Pacific Rim. It employs a vertically integrated
and geographically diverse business model, covering the full spectrum from raw material to
retail outlets across an extensive product range.
8
Information on Poundland
Poundland is the largest single-price value general merchandise retailer in Europe by both
sales and by number of stores. Poundland operates a network of over 900 stores across the
UK, Republic of Ireland, and Spain.
Poundland is a price-driven, volume-led business offering an extensive range of products
across 17 categories, with the average Poundland store carrying approximately 3,500 core
range SKUs, including over 1,000 branded products, including Cadbury, Mars, Heinz,
Nestle, Colgate, Coca Cola, Walkers and McVities, and a number of own branded products,
including Jane Asher’s Kitchen, Make-up Gallery cosmetics and Purple Ivy Jewellery.
12
Poundland operates from headquarters in Willenhall, West Midlands, and employed on
average 18,000 colleagues in the financial year ended 27 March 2016. Poundland
distribution capacity was enhanced in June 2016 with a new purpose built 350,000 sq. ft.
distribution centre at Wigan.
In the financial year ended 27 March 2016, Poundland generated revenue of £1,326.0
million and Underlying EBITDA* of £56.9 million with an Underlying comparable EBITDA
margin* of 4.6 per cent.
* Underlying includes contributions from converted 99p stores.
9
Management, employees and locations
The transaction will create an exciting opportunity for the Poundland management and
employees to join Steinhoff. Steinhoff recognises the strength and value of the Poundland
management and employees and considers them to be important to the future success of
Poundland. Following the completion of the Offer, the existing contractual and statutory
employment rights of the Poundland executive directors, Poundland Executive Committee
and employees shall be fully observed and pension obligations complied with, in
accordance with applicable law.
Steinhoff’s plans for Poundland do not involve any material change in the conditions of
employment of Poundland’s employees. Steinhoff has no plans to change Poundland’s
places of business.
Steinhoff has agreed to enter into good faith discussions with Poundland to determine the
treatment of Poundland’s bonus arrangements for the current financial year.
10
Arrangements between Steinhoff and Poundland management
Steinhoff has agreed that any executive director or member of the Poundland Executive
Committee who leaves employment within 24 months following the Effective Date for a good
leaver reason will be eligible to a payment in lieu of any part of his or her notice period that
is not required to be worked in a single lump sum.
Steinhoff has acknowledged that Poundland may make grants under the Poundland
Performance Share Plan and the Poundland Restricted Share Plan prior to the Effective
Date to satisfy pre-existing obligations to certain key executives, including executive
directors and members of the Poundland Executive Committee, and Steinhoff has further
agreed to offer to exchange those awards for equivalent awards over Steinhoff shares or
cash of an equivalent value. If Poundland has not made such grants prior to the Effective
Date, Steinhoff has agreed to grant awards over Steinhoff shares or cash awards of an
equivalent value no later than three months after the Effective Date.
Various arrangements have also been agreed in relation to the treatment of existing awards
under the Poundland Performance Share Plan, a plan in which a number of senior
employees, including executive directors and members of the Poundland Executive
Committee, participate. Steinhoff has agreed to offer each holder of Performance Share
Plan awards granted in 2014 the opportunity to exchange one sixth of the Poundland
Shares comprised in the award for an equivalent award over shares in Steinhoff, subject to
performance targets that are to be agreed. The treatment of awards granted under the plan
in 2015 remains subject to discussion between Poundland and Steinhoff.
13
11
Poundland Share Plans
Participants in the Poundland Share Plans will be contacted regarding the effect of the Offer
on their rights under the Poundland Share Plans and appropriate proposals shall be made
to such participants in due course. Further details of the terms of such proposals shall be
included in the Scheme Document. Arrangements in relation to the Poundland Performance
Share Plan are described in paragraph 10 above. In addition, Steinhoff has agreed that
participants will be given the opportunity to exchange all outstanding options under the
Poundland Company Share Option Plan and the Poundland Sharesave Scheme for options
over Steinhoff shares of equivalent value. Exchange will not be offered in relation to awards
currently outstanding under the Poundland Restricted Share Plan.
Steinhoff shall enter into good faith discussions to ensure that employees at or below
executive level shall for a period of at least 12 month after the Effective Date be able to
participate in broadly comparable arrangements to the ones provided to such employees by
Poundland.
12
Financing
The cash consideration payable under the Offer will be funded from the acquisition facility
provided by Crédit Agricole Corporate and Investment Bank and UniCredit Bank Austria AG.
Investec Bank plc, financial adviser to Steinhoff and SEAG, is satisfied that sufficient
resources are available to satisfy in full the cash consideration payable to Poundland
Shareholders under the terms of the Offer (which, for the avoidance of doubt, does not
include the Agreed Dividend which is payable by Poundland).
13
Offer-related Arrangements
Confidentiality Agreement
Steinhoff and Poundland entered into a confidentiality and standstill agreement on 4 July
2016 (the “Confidentiality Agreement”) pursuant to which Steinhoff has undertaken to
keep confidential information relating to Poundland and not to disclose it to third parties
(other than to permitted disclosees) unless required by law or regulation. These
confidentiality obligations shall remain in force until (i) completion of the Offer, or, (ii) in the
event of termination of discussions or negotiations, the expiry of a period of 12 months from
the date of the Confidentiality Agreement.
This agreement also contains undertakings from Steinhoff that for a period of nine months
Steinhoff shall not, without Poundland’s prior written consent, acquire or offer to acquire any
interest in any shares or other securities of Poundland (which undertaking ceases as of the
date of this Announcement), and that, for a period of 12 months, Steinhoff shall not, without
Poundland’s prior written consent, approach any of Poundland’s employees, offices or
customers or employ or otherwise engage certain of the Poundland employees.
Co-operation Agreement
Pursuant to a co-operation agreement dated 13 July 2016 (the “Co-operation Agreement”):
(i) Poundland and SEAG have agreed to co-operate with each other and provide each other
with all reasonable information, assistance and access in a timely manner in order to make
any regulatory filings; (ii) SEAG has agreed to provide Poundland with certain information
for the purposes of the Scheme Document and to otherwise assist with the preparation of
the Scheme Document; (iii) SEAG has reserved its right, with the consent of the Panel, to
14
implement the Offer by way of a takeover offer and agreed to certain provisions that would
apply in the event of a switch to a takeover offer; and (iv) each of Poundland and SEAG has
agreed to take any action necessary to implement certain proposals in relation to the
Poundland Share Plans.
SEAG has also undertaken in the Co-operation Agreement to vote in favour of the
resolutions proposed at the General Meeting in respect of its entire beneficial holding of
Poundland Shares. SEAG is not permitted to vote on the Scheme at the Court Meeting.
The Co-operation Agreement will terminate: (i) if agreed in writing by SEAG and Poundland;
(ii) upon written notice from SEAG to Poundland if the Poundland Directors withdraw,
adversely modify or adversely qualify their unconditional and unanimous recommendation of
the Offer; (iii) upon written notice from SEAG to Poundland if a competing transaction,
completes, becomes effective or is declared unconditional in all respects; (iv) if the Scheme
is withdrawn or lapses (other than pursuant to SEAG’s right to switch to a takeover offer or
where such withdrawal or lapse is followed within ten Business Days by an announcement
by SEAG or a person acting in concert with SEAG of a firm intention to make an offer on
substantially the same or improved terms); or (v) upon written notice by either party, if the
Offer has not become Effective by 30 November 2016.
14
Structure of the Offer
It is intended that the Offer shall be effected by means of a Court-approved scheme of
arrangement between Poundland and Poundland Shareholders under Part 26 of the
Companies Act. SEAG reserves the right to elect to implement the Offer by way of a
takeover offer (subject to Panel consent).
The purpose of the Scheme is to provide for SEAG to become the holder of the entire
issued and to be issued share capital of Poundland not already directly or indirectly owned
by it. Under the Scheme, the Poundland Shares will be transferred to SEAG in consideration
for which the Poundland Shareholders shall receive cash consideration on the basis set out
in paragraph 2 of this Announcement.
To become Effective, the Scheme must be approved by a majority in number of the
Poundland Shareholders voting at the Court Meeting, either in person or by proxy,
representing at least 75 per cent. in value of the Poundland Shares voted (in both cases
excluding SEAG who will not be permitted to vote at the Court Meeting). In addition,
resolutions in relation to certain ancillary matters must be passed at the General Meeting,
which requires the approval of holders of Poundland Shares representing at least 75 per
cent. of votes cast at the General Meeting either in person or by proxy (including SEAG who
will be permitted to vote at the General Meeting).
SEAG is not permitted to vote on the Scheme at the Court Meeting but has undertaken in
the Co-operation Agreement to vote in favour of the resolutions proposed at the General
Meeting in respect of its entire beneficial holding of Poundland Shares.
The Scheme is also subject to the Conditions and further terms set out in Appendix I to this
Announcement and to be set out in the Scheme Document.
Once the necessary approvals from holders of Poundland Shares have been obtained and
the other Conditions have been satisfied or (where applicable) waived, the Scheme must be
approved by the Court. The Scheme shall then become Effective upon delivery of the Court
15
Order to the Registrar of Companies. Subject to satisfaction of the Conditions, the Scheme
is expected to become Effective by mid-September 2016.
Upon the Scheme becoming Effective, it shall be binding on all Poundland Shareholders,
irrespective of whether or not they attended or voted at the Court Meeting or the General
Meeting.
Further details of the Scheme, including an indicative timetable for its implementation, shall
be set out in the Scheme Document.
It is expected that the Scheme Document and the Forms of Proxy accompanying the
Scheme Document will be published as soon as practicable and, in any event, (save with
the consent of the Panel) within 28 days of this Announcement. The Scheme Document and
Forms of Proxy will be made available to all holders of Poundland Shares at no charge to
them.
15
Conditions to the Offer
The Offer shall be subject to the Conditions and further terms set out in Appendix I to this
Announcement and to be set out in the Scheme Document.
The Scheme will be subject to the following conditions:
(i)
its approval by a majority in number of the Poundland Shareholders who are
present and vote, whether in person or by proxy, at the Court Meeting and who
represent 75 per cent. in value of the Poundland Shares voted by those Poundland
Shareholders;
(ii)
the resolution(s) required to approve and implement the Scheme being duly
passed by holders of Poundland Shares representing 75 per cent. or more of votes
cast at the General Meeting; and
(iii)
the approval of the Scheme by the Court (with or without modification but subject to
any modification being on terms acceptable to Poundland and SEAG) and the
delivery of a copy of the Court Order to the Registrar of Companies.
The Offer shall lapse if:
nd

the Court Meeting and the General Meeting are not held by the 22 day after the
expected date of such meetings as set out in the Scheme Document (or such later
date as may be agreed between SEAG and Poundland); or

the Scheme does not become Effective by 30 November 2016,
provided, however, that the deadlines for the timing of the Court Meeting and the General
Meeting and the deadline for the Scheme to become Effective may be extended by
agreement between Poundland and SEAG (with the consent of the Panel and the Court, if
required).
The Offer is not conditional upon any antitrust approvals being obtained and will close
shortly after receiving the requisite approvals at the Court Meeting and the General Meeting,
and the Scheme being sanctioned by the Court.
16
16
De-listing and re-registration
Prior to the Scheme becoming Effective, Poundland shall make an application, which shall
be conditional on the Scheme becoming Effective, for the cancellation of the listing of
Poundland Shares on the Official List and for the cancellation of trading of the Poundland
Shares on the London Stock Exchange’s main market for listed securities in each case to
take effect from or shortly after the Effective Date. The last day of dealings in Poundland
Shares on the Main Market of the London Stock Exchange is expected to be the Business
Day immediately prior to the Effective Date and no transfers shall be registered after
6.00p.m. on that date.
On the Effective Date, share certificates in respect of Poundland Shares shall cease to be
valid and entitlements to Poundland Shares held within the CREST system shall be
cancelled.
It is proposed, as part of the application to Court in connection with the Scheme, to seek an
order of the Court pursuant to Section 651 of the Companies Act to re-register Poundland as
a private limited company.
17
Dividend
Holders of Poundland Shares whose names are on the register on 9 September 2016 shall
be entitled to receive the Agreed Dividend without any reduction in the Offer Price payable
under the terms of the Offer. The Agreed Dividend will be paid on 23 September 2016.
If any dividend or other distribution is authorised, declared, made or paid in respect of
Poundland Shares on or after the date of this Announcement and prior to closing of the
Offer other than the Agreed Dividend, or in excess of the Agreed Dividend, the Offer Price
shall be reduced by the amount of such dividend or other distribution or by the excess
above the Agreed Dividend.
18
Disclosure of Interests in Poundland
Save in respect of the irrevocable undertakings referred to in paragraph 6 above and as
disclosed below, as at the close of business on 12 July 2016 (being the last practicable date
prior to the date of this Announcement) neither Steinhoff, SEAG nor any of its directors, nor,
so far as Steinhoff is aware, any person acting in concert (within the meaning of the
Takeover Code) with it has (i) any interest in or right to subscribe for any relevant securities
of Poundland, nor (ii) any short positions in respect of relevant Poundland Shares (whether
conditional or absolute and whether in the money or otherwise), including any short position
under a derivative, any agreement to sell or any delivery obligation or right to require
another person to purchase or take delivery, nor (iii) borrowed or lent any relevant
Poundland Shares (including, for these purposes, any financial collateral arrangements of
the kind referred to in Note 4 on Rule 4.6 of the Takeover Code), save for any borrowed
shares which had been either on-lent or sold:
Name
Steinhoff Europe AG
17
Nature of Interest
Number of
Poundland Shares
Securities owned
and/or controlled
63,473,352
'Interests in securities' for these purposes arise, in summary, when a person has long
economic exposure, whether absolute or conditional, to changes in the price of securities
(and a person who only has a short position in securities is not treated as interested in those
securities). In particular, a person will be treated as having an 'interest' by virtue of the
ownership, voting rights or control of securities, or by virtue of any agreement to purchase,
option in respect of, or derivative referenced to, securities.
19
General
SEAG reserves the right to elect (subject to the consent of the Panel) to implement the
acquisition of the Poundland Shares not already directly or indirectly owned by it by way of a
takeover offer as an alternative to the Scheme. In such event, the acquisition shall be
implemented on substantially the same terms as those which would apply to the Scheme
(subject to appropriate amendments, including an acceptance condition set at 75 per cent.
of the Poundland Shares or such lesser percentage, being more than 50 per cent., as SEAG
may decide).
The Offer shall be made subject to the Conditions and further terms set out in Appendix I to
this Announcement and to be set out in the Scheme Document. The bases and sources of
certain financial information contained in this Announcement are set out in Appendix II to
this Announcement. A summary of the irrevocable undertakings given in relation to the Offer
is contained in Appendix III to this Announcement. Certain terms used in this Announcement
are defined in Appendix IV to this Announcement.
Investec Bank plc, J.P. Morgan Cazenove and Rothschild have each given and not
withdrawn their consent to the publication of this Announcement with the inclusion herein of
the references to their names in the form and context in which they appear.
20
Documents available on website
Copies of the following documents shall be made available on Steinhoff’s and Poundland’s
websites at www.steinhoffinternational.com and www.poundlandcorporate.com respectively)
until the end of the Offer:

the irrevocable undertakings referred to in paragraph 6 above and summarised in
Appendix III to this Announcement;

documents relating to the financing of the Scheme referred to in paragraph 12
above;

the written consents provided by each of Investec Bank plc, J.P. Morgan Cazenove
and Rothschild;

the Confidentiality Agreement referred to in paragraph 13 above; and

the Co-operation Agreement referred to in paragraph 13 above.
Further Information
Linklaters LLP are providing legal advice to Steinhoff and SEAG. Freshfields Bruckhaus
Deringer LLP are providing legal advice to Poundland.
18
Enquiries
Steinhoff and SEAG
Tel: +27 (0)21 808 0711
Mariza Nel, Director, Corporate Services (Investor
Relations)
Nick Agarwal (UK Press)
Tel: +44 (0)75 6810 1045
Investec Bank plc (financial adviser to Steinhoff and
SEAG)
Tel: +44 (0)20 7597 4000
Andrew Pinder / David Anderson
Sara Hale / Henry Reast (Corporate Broking)
Poundland
Darren Shapland, Chairman
Tel: +44 (0)12 1526 8688
Philip Dorgan, Head of Investor Relations
Tel: +44 (0)12 1568 7000
J.P. Morgan Cazenove (joint financial adviser and
corporate broker to Poundland)
Tel: +44 (0) 20 7742 4000
Toby Radford / Caroline Thomlinson
Mark Breuer / James Robinson
Rothschild (joint financial adviser to Poundland)
Tel: +44 (0) 20 7280 5000
Majid Ishaq
John Byrne
Shore Capital (corporate broker to Poundland)
Tel: +44 (0) 20 7408 4090
Dru Danford
Patrick Castle
Citigate Dewe Rogerson (PR adviser to Poundland)
Simon Rigby
Tel: +44 (0) 20 7282 2847
Kevin Smith
Tel: +44 (0) 20 7282 1054
Nick Hayns
Tel: +44 (0) 20 7282 1032
Important Notices
Investec Bank plc is authorised by the Prudential Regulation Authority and regulated by the
Financial Conduct Authority and the Prudential Regulation Authority in the UK. Investec
Bank plc is acting exclusively as financial adviser to Steinhoff and SEAG and no one else in
connection with the Offer and shall not be responsible to anyone other than Steinhoff and
SEAG for providing the protections afforded to clients of Investec Bank plc nor for providing
advice in connection with the Offer or any matter referred to herein.
J.P. Morgan Limited, which conducts its UK investment banking business as J.P. Morgan
Cazenove ("J.P. Morgan Cazenove"), is authorised and regulated in the United Kingdom by
the Financial Conduct Authority. J.P. Morgan Cazenove is acting as financial adviser
exclusively for Poundland and no one else in connection with the matters set out in this
Announcement and will not regard any other person as its client in relation to the matters in
19
this Announcement and will not be responsible to anyone other than Poundland for
providing the protections afforded to clients of J.P. Morgan Cazenove, nor for providing
advice in relation to any matter referred to herein.
N. M. Rothschild & Sons Limited, which is authorised by the Prudential Regulation Authority
and regulated by the FCA and the Prudential Regulation Authority in the United Kingdom, is
acting exclusively for Poundland and no one else in connection with the Offer and will not be
responsible to anyone other than Poundland for providing the protections afforded to its
clients or for providing advice in relation to the Offer or any other matters referred to in this
Announcement.
Shore Capital Stockbrokers Limited (“Shore Capital”) which is authorised and regulated in
the United Kingdom by the Financial Conduct Authority is acting as corporate broker to
Poundland and no one else in connection with the Offer and other matters described in this
Announcement and will not be responsible to anyone other than Poundland for providing the
protections afforded to clients of Shore Capital or for providing advice in relation to the Offer
and other matters described in this Announcement.
This Announcement is for information purposes only and does not constitute an offer to sell
or an invitation to purchase any securities or the solicitation of an offer to buy any securities,
pursuant to the Offer or otherwise. The Offer shall be made solely by means of the Scheme
Document or any document by which the Offer is made which shall contain the full terms
and Conditions of the Offer, including details of how to vote in respect of the acquisition.
This Announcement has been prepared for the purpose of complying with English law and
the Takeover Code and the information disclosed may not be the same as that which would
have been disclosed if this Announcement had been prepared in accordance with the laws
of jurisdictions outside the United Kingdom.
Poundland shall prepare the Scheme Document to be distributed to holders of Poundland
Shares. Poundland, SEAG and Steinhoff urge Poundland Shareholders to read the Scheme
Document when it becomes available because it shall contain important information relating
to the Offer.
Overseas Shareholders
The release, publication or distribution of this Announcement in certain jurisdictions may be
restricted by law. Persons who are not resident in the United Kingdom or who are subject to
other jurisdictions should inform themselves of, and observe, any applicable requirements.
The Offer relates to shares of a UK company and is proposed to be effected by means of a
scheme of arrangement under the laws of England and Wales. A transaction effected by
means of a scheme of arrangement is not subject to proxy solicitation or tender offer rules
under the US Securities Exchange Act of 1934 (the “US Exchange Act”). Accordingly, the
Scheme is subject to the disclosure requirements, rules and practices applicable in the
United Kingdom to schemes of arrangement, which differ from the requirements of US proxy
solicitation or tender offer rules. However, if SEAG were to elect to implement the Offer by
means of a takeover offer in the circumstances provided for in this Announcement, such
takeover offer shall be made in compliance with all applicable laws and regulations,
including Section 14(e) of the US Exchange Act and Regulation 14E thereunder. Such a
takeover would be made in the United States by SEAG and no one else. In addition to any
such takeover offer, SEAG, certain affiliated companies and the nominees or brokers (acting
as agents) may make certain purchases of, or arrangements to purchase, shares in
20
Poundland outside such takeover offer during the period in which such takeover offer would
remain open for acceptance. If such purchases or arrangements to purchase were to be
made they would be made outside the United States and would comply with applicable law,
including the US Exchange Act.
Unless otherwise determined by SEAG or required by the Takeover Code, and permitted by
applicable law and regulation, the Offer shall not be made available, directly or indirectly, in,
into or from a Restricted Jurisdiction where to do so would violate the laws in that
jurisdiction and no person may vote in favour of the offer by any such use, means,
instrumentality or form within a Restricted Jurisdiction or any other jurisdiction if to do so
would constitute a violation of the laws of that jurisdiction. Accordingly, copies of this
Announcement and all documents relating to the Offer are not being, and must not be,
directly or indirectly, mailed or otherwise forwarded, distributed or sent in, into or from a
Restricted Jurisdiction where to do so would violate the laws in that jurisdiction, and persons
receiving this Announcement and all documents relating to the Offer (including custodians,
nominees and trustees) must not mail or otherwise distribute or send them in, into or from
such jurisdictions where to do so would violate the laws in that jurisdiction.
The availability of the Offer to Poundland Shareholders who are not resident in the United
Kingdom may be affected by the laws of the relevant jurisdictions in which they are resident.
Persons who are not resident in the United Kingdom should inform themselves of, and
observe, any applicable requirements.
The Offer shall be subject to the applicable requirements of the Takeover Code, the Panel,
the London Stock Exchange, the Financial Conduct Authority and the UKLA.
This Announcement does not constitute a prospectus or prospectus equivalent document.
Forward looking statements
This Announcement contains statements about Steinhoff, SEAG and Poundland that are or
may be forward looking statements. All statements other than statements of historical facts
included in this Announcement may be forward looking statements. Without limitation, any
statements preceded or followed by or that include the words “targets”, “plans”, “believes”,
“expects”, “aims”, “intends”, “will”, “may”, “anticipates”, “estimates”, “projects” or words or
terms of similar substance or the negative thereof, are forward looking statements. Forward
looking statements include statements relating to the following: (i) future capital
expenditures, expenses, revenues, earnings, synergies, economic performance,
indebtedness, financial condition, dividend policy, losses and future prospects; (ii) business
and management strategies and the expansion and growth of Steinhoff’s or Poundland’s
operations and potential synergies resulting from the Offer; and (iii) the effects of
government regulation on Steinhoff’s or Poundland’s business.
Such forward looking statements involve risks and uncertainties that could significantly
affect expected results and are based on certain key assumptions. Many factors could
cause actual results to differ materially from those projected or implied in any forward
looking statements. Due to such uncertainties and risks, readers are cautioned not to place
undue reliance on such forward looking statements, which speak only as of the date hereof.
Each of Steinhoff, SEAG and Poundland disclaims any obligation to update any forward
looking or other statements contained herein, except as required by applicable law.
21
No profit forecasts or estimates
No statement in this Announcement is intended as a profit forecast or estimate for any
period and no statement in this Announcement should be interpreted to mean that earnings
or earnings per share for Steinhoff or Poundland, as appropriate, for the current or future
financial years would necessarily match or exceed the historical published earnings or
earnings per share for Steinhoff or Poundland, as appropriate.
Disclosure requirements of the Takeover Code
Under Rule 8.3(a) of the Takeover Code, any person who is interested in 1 per cent. or more
of any class of relevant securities of an offeree company or of any securities exchange
offeror (being any offeror other than an offeror in respect of which it has been announced
that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure
following the commencement of the Offer Period and, if later, following the announcement in
which any securities exchange offeror is first identified. An Opening Position Disclosure must
contain details of the person’s interests and short positions in, and rights to subscribe for,
any relevant securities of each of (i) the offeree company and (ii) any securities exchange
offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be
made by no later than 3.30 pm (London time) on the 10th Business Day following the
commencement of the Offer Period and, if appropriate, by no later than 3.30 pm (London
time) on the 10th Business Day following the announcement in which any securities
exchange offeror is first identified. Relevant persons who deal in the relevant securities of
the offeree company or of a securities exchange offeror prior to the deadline for making an
Opening Position Disclosure must instead make a Dealing Disclosure.
Under Rule 8.3(b) of the Takeover Code, any person who is, or becomes, interested in 1 per
cent. or more of any class of relevant securities of the offeree company or of any securities
exchange offeror must make a Dealing Disclosure if the person deals in any relevant
securities of the offeree company or of any securities exchange offeror. A Dealing Disclosure
must contain details of the dealing concerned and of the person’s interests and short
positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree
company and (ii) any securities exchange offeror, save to the extent that these details have
previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule
8.3(b) applies must be made by no later than 3.30 pm (London time) on the Business Day
following the date of the relevant dealing.
If two or more persons act together pursuant to an agreement or understanding, whether
formal or informal, to acquire or control an interest in relevant securities of an offeree
company or a securities exchange offeror, they will be deemed to be a single person for the
purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree company and by any offeror
and Dealing Disclosures must also be made by the offeree company, by any offeror and by
any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).
Details of the offeree and offeror companies in respect of whose relevant securities Opening
Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure
Table on the Panel’s website at http://www.thetakeoverpanel.org.uk, including details of the
number of relevant securities in issue, when the Offer Period commenced and when any
offeror was first identified. If you are in any doubt as to whether you are required to make an
Opening Position Disclosure or a Dealing Disclosure, you should contact the Panel’s Market
Surveillance Unit on +44 (0)20 7638 0129.
22
Publication on Website and Availability of Hard Copies
A copy of this Announcement shall be made available subject to certain restrictions relating
to persons resident in Restricted Jurisdictions on Steinhoff’s and Poundland’s websites at
www.steinhoffinternational.com and http://www.poundlandcorporate.com respectively by no
later than 12 noon (London time) on 14 July 2016. For the avoidance of doubt, the content
of the websites referred to in this Announcement are not incorporated into and do not form
part of this Announcement.
You may request a hard copy of this Announcement by:

for Steinhoff shareholders, contacting the Company Secretary at Steinhoff UK
th
Holdings Limited, 5 Floor Festival House, Jessop Avenue, Cheltenham,
Gloucestershire, GL50 3SH, United Kingdom. Telephone number: +44 (0) 1242
586360; or

for Poundland Shareholders, by writing to Poundland’s registrar at Computershare,
The Pavilions, Bridgwater Road, Bristol BS13 8AE or by calling them on 0370 707
1028 from within the UK or on +44 (0)370 707 1028 if calling from outside the UK.
You may also request that all future documents, announcements and information to be sent
to you in relation to the Offer should be in hard copy form.
Rounding
Certain figures included in this Announcement have been subjected to rounding
adjustments. Accordingly, figures shown for the same category presented in different tables
may vary slightly and figures shown as totals in certain tables may not be an arithmetic
aggregation of the figures that precede them.
23
APPENDIX I
CONDITIONS AND FURTHER TERMS OF THE OFFER
Part A: Conditions of the Scheme
The Offer is conditional upon the Scheme becoming unconditional and Effective, subject to the
Takeover Code, by not later than 30 November 2016 or such later date (if any) as SEAG and
Poundland may agree and (if required) the Panel and the Court may allow.
1
The Scheme shall be subject to the following conditions:
1.1
(i)
its approval by a majority in number of the Poundland Shareholders who are present
and vote, whether in person or by proxy, at the Court Meeting and who represent 75
per cent. or more in value of the Poundland Shares voted by those Poundland
Shareholders; and
(ii)
such Court Meeting being held on or before the 22nd day after the expected date of
the Court Meeting as set out in the Scheme Document (or such later date as may be
agreed by SEAG and Poundland and the Court may allow);
1.2
2
(iii)
the resolution(s) required to approve and implement the Scheme being duly passed
by holders of Poundland Shares representing 75 per cent. or more of votes cast at
the General Meeting; and
(iv)
such General Meeting being held on or before the 22nd day after the expected date
of the General Meeting as set out in the Scheme Document (or such later date as
may be agreed by SEAG and Poundland and the Court may allow); and
1.3
the sanction of the Scheme by the Court (with or without modification but subject to
any modification being on terms acceptable to Poundland and SEAG) and the
delivery of a copy of the Court Order to the Registrar of Companies.
In addition, subject as stated in Part B below and to the requirements of the Panel, the Offer
shall be conditional upon the following Conditions and, accordingly, the Court Order shall
not be delivered to the Registrar of Companies unless such Conditions (as amended if
appropriate) have been satisfied or, where relevant, waived:
Certain matters arising as a result of any arrangement, agreement, etc.
(a)
except as Disclosed, there being no provision of any arrangement, agreement, lease,
licence, franchise, permit or other instrument to which any member of the Wider
Poundland Group is a party or by or to which any such member or any of its assets is
or may be bound, entitled or be subject or any event or circumstance which, as a
consequence of the Offer or the acquisition or the proposed acquisition by any member
of the Wider Steinhoff Group of any shares or other securities (or the equivalent) in
Poundland or because of a change in the control or management of any member of the
Wider Poundland Group or otherwise, could or might reasonably be expect to result in:
(i)
any monies borrowed by, or any other indebtedness, actual or contingent, of, or
any grant available to, any member of the Wider Poundland Group being or
becoming repayable, or capable of being declared repayable, immediately or
prior to its or their stated maturity date or repayment date, or the ability of any
24
such member to borrow monies or incur any indebtedness being withdrawn or
inhibited or being capable of becoming or being withdrawn or inhibited;
(ii)
the creation, save in the ordinary and usual course of business, or enforcement
of any mortgage, charge or other security interest over the whole or any part of
the business, property or assets of any member of the Wider Poundland Group
or any such mortgage, charge or other security interest (whenever created,
arising or having arisen) becoming enforceable;
(iii)
any such arrangement, agreement, lease, licence, franchise, permit or other
instrument being terminated or the rights, liabilities, obligations or interests of any
member of the Wider Poundland Group being adversely modified or adversely
affected or any obligation or liability arising or any adverse action being taken or
arising thereunder;
(iv)
any liability of any member of the Wider Poundland Group to make any
severance, termination, bonus or other payment to any of its directors, or other
officers;
(v)
the rights, liabilities, obligations, interests or business of any member of the
Wider Poundland Group or any member of the Wider Steinhoff Group under any
such arrangement, agreement, licence, permit, lease or instrument or the
interests or business of any member of the Wider Poundland Group or any
member of the Wider Steinhoff Group in or with any other person or body or firm
or company (or any arrangement or arrangement relating to any such interests or
business) being or becoming capable of being terminated, or adversely modified
or affected or any onerous obligation or liability arising or any adverse action
being taken thereunder;
(vi)
any member of the Wider Poundland Group ceasing to be able to carry on
business under any name under which it presently carries on business;
(vii)
the value of, or the financial or trading position or prospects of, any member of
the Wider Poundland Group being prejudiced or adversely affected; or
(viii)
the creation or acceleration of any liability (actual or contingent) by any member
of the Wider Poundland Group other than trade creditors or other liabilities
incurred in the ordinary course of business,
and no event having occurred which, under any provision of any arrangement,
agreement, licence, permit, franchise, lease or other instrument to which any member
of the Wider Poundland Group is a party or by or to which any such member or any of
its assets are bound, entitled or subject, would or might result in any of the events or
circumstances as are referred to in Conditions (a)(i) to (viii);
Certain events occurring since 27 March 2016
(b)
except as Disclosed, no member of the Wider Poundland Group having since 27 March
2016:
(i)
issued or agreed to issue or authorised or proposed or announced its intention to
authorise or propose the issue, of additional shares of any class, or securities or
securities convertible into, or exchangeable for, or rights, warrants or options to
subscribe for or acquire, any such shares, securities or convertible securities or
transferred or sold or agreed to transfer or sell or authorised or proposed the
25
transfer or sale of Poundland Shares out of treasury (except, where relevant, as
between Poundland and wholly owned subsidiaries of Poundland or between the
wholly owned subsidiaries of Poundland and except for the issue or transfer out
of treasury of Poundland Shares on the exercise of employee share options or
vesting of employee share awards in the ordinary course under the Poundland
Share Plans);
(ii)
except for the Agreed Dividend, recommended, declared, paid or made any
bonus, dividend or other distribution (whether payable in cash or otherwise) other
than dividends (or other distributions whether payable in cash or otherwise)
lawfully paid or made by any wholly owned subsidiary of Poundland to
Poundland or any of its wholly owned subsidiaries;
(iii)
other than pursuant to the Offer (and except for transactions between Poundland
and its wholly owned subsidiaries or between the wholly owned subsidiaries of
Poundland and transactions in the ordinary course of business), implemented,
effected, authorised or proposed or announced its intention to implement, effect,
authorise or propose any merger, demerger, reconstruction, amalgamation,
scheme, commitment or acquisition or disposal of assets or shares or loan
capital (or the equivalent thereof) in any undertaking or undertakings in any such
case to an extent which is material in the context of the Wider Poundland Group
taken as a whole;
(iv)
except for transactions between Poundland and its wholly owned subsidiaries or
between the wholly owned subsidiaries of Poundland and transactions in the
ordinary course of business, disposed of, or transferred, mortgaged or created
any security interest over any material asset or any right, title or interest in any
material asset or authorised, proposed or announced any intention to do so;
(v)
(except for transactions between Poundland and its wholly owned subsidiaries or
between the wholly owned subsidiaries of Poundland) issued, authorised or
proposed or announced an intention to authorise or propose, the issue of or
made any change in or to the terms of any debentures or become subject to any
contingent liability or incurred or increased any indebtedness which is material in
the context of the Wider Poundland Group as a whole;
(vi)
except in the ordinary course of business, entered into or varied or authorised,
proposed or announced its intention to enter into or vary any contract,
arrangement, agreement, transaction or commitment (whether in respect of
capital expenditure or otherwise), which is of a long term, unusual or onerous
nature or magnitude or which is or which involves or is reasonably likely to
involve an obligation of a nature or magnitude which is reasonably likely to be
materially restrictive on the business of any member of the Wider Poundland
Group which, taken together with any other such material transaction,
arrangement, agreement, contract or commitment, is material in the context of
the Wider Poundland Group as a whole;
(vii)
entered into or varied the terms of, or made any offer (which remains open for
acceptance) to enter into or vary the terms of any contract, service agreement,
commitment or arrangement with any director or senior executive of any member
of the Wider Poundland Group;
26
(viii)
proposed, agreed to provide or modified the terms of any share option scheme,
incentive scheme or other benefit relating to the employment or termination of
employment of any employee of the Wider Poundland Group which are material
in the context of the Wider Poundland Group taken as a whole;
(ix)
purchased, redeemed or repaid or announced any proposal to purchase, redeem
or repay any of its own shares or other securities or reduced or, except in respect
of the matters mentioned in sub-paragraph (i) above, made any other change to
any part of its share capital;
(x)
except in the ordinary course of business, waived, compromised or settled any
claim which is material in the context of the Wider Poundland Group as a whole;
(xi)
terminated or varied the terms of any agreement or arrangement between any
member of the Wider Poundland Group and any other person in a manner which
would or might reasonably be expected to have a material adverse effect on the
financial position of the Wider Poundland Group taken as a whole;
(xii)
(except as disclosed on publicly available registers) made any alteration to its
memorandum or articles of association or other incorporation documents;
(xiii)
except in relation to changes made or agreed as a result of, or arising from,
changes to legislation, made or agreed or consented to any change to:
(a)
the terms of the trust deeds and rules constituting the pension
scheme(s) established by any member of the Wider Poundland
Group for its directors, employees or their dependants;
(b)
the contributions payable to any such scheme(s) or to the benefits
which accrue, or to the pensions which are payable, thereunder;
(c)
the basis on which qualification for, or accrual or entitlement to,
such benefits or pensions are calculated or determined; or
(d)
the basis upon which the liabilities (including pensions) of such
pension schemes are funded, valued, made, agreed or consented
to,
to an extent which is in any such case material in the context of the Wider
Poundland Group;
(xiv) been unable, or admitted in writing that it is unable, to pay its debts or
commenced negotiations with one or more of its creditors with a view to
rescheduling or restructuring any of its indebtedness, or having stopped or
suspended (or threatened to stop or suspend) payment of its debts generally or
ceased or threatened to cease carrying on all or a substantial part of its
business;
(xv)
(other than in respect of a member of the Wider Poundland Group which is
dormant and was solvent at the relevant time) taken or proposed any steps,
corporate action or had any legal proceedings instituted or threatened against it
in relation to the suspension of payments, a moratorium of any indebtedness, its
winding-up (voluntary or otherwise), dissolution, reorganisation or for the
appointment of a receiver, administrator, manager, administrative receiver,
trustee or similar officer of all or any material part of its assets or revenues or any
27
analogous or equivalent steps or proceedings in any jurisdiction or appointed any
analogous person in any jurisdiction or had any such person appointed;
(xvi) (except for transactions between Poundland and its wholly owned subsidiaries or
between the wholly owned subsidiaries), made, authorised, proposed or
announced an intention to propose any change in its loan capital;
(xvii) entered into, implemented or authorised the entry into, any joint venture, asset or
profit sharing arrangement, partnership or merger of business or corporate
entities; or
(xviii) entered into any agreement, arrangement, commitment or contract or passed
any resolution or made any offer (which remains open for acceptance) with
respect to or announced an intention to, or to propose to, effect any of the
transactions, matters or events referred to in this Condition (b);
No adverse change, litigation, regulatory enquiry or similar
(c)
except as Disclosed, since 27 March 2016 there having been:
(i)
no adverse change and no circumstance having arisen which would or might be
expected to result in any adverse change in, the business, assets, financial or
trading position or profits or prospects or operational performance of any
member of the Wider Poundland Group which is material in the context of the
Wider Poundland Group;
(ii)
no litigation, arbitration proceedings, prosecution or other legal proceedings
having been threatened, announced or instituted by or against or remaining
outstanding against or in respect of, any member of the Wider Poundland Group
or to which any member of the Wider Poundland Group is or may become a
party (whether as claimant, defendant or otherwise) having been threatened,
announced, instituted or remaining outstanding by, against or in respect of, any
member of the Wider Poundland Group, in each case which might reasonably be
expected to have a material adverse effect on the Wider Poundland Group taken
as a whole;
(iii)
no enquiry, review or investigation by, or complaint or reference to, any Third
Party against or in respect of any member of the Wider Poundland Group having
been threatened, announced or instituted or remaining outstanding by, against or
in respect of any member of the Wider Poundland Group, in each case which
might reasonably be expected to have a material adverse effect on the Wider
Poundland Group taken as a whole;
(iv)
no contingent or other liability having arisen or become apparent to SEAG or
increased other than in the ordinary course of business which is reasonably likely
to affect adversely the business, assets, financial or trading position or profits or
prospects of any member of the Wider Poundland Group to an extent which is
material in the context of the Wider Poundland Group taken as a whole; and
(v)
no steps having been taken and no omissions having been made which are likely
to result in the withdrawal, cancellation, termination or modification of any licence
held by any member of the Wider Poundland Group which is necessary for the
proper carrying on of its business and the withdrawal, cancellation, termination or
modification of which might reasonably be expected to have a material adverse
effect on the Wider Poundland Group taken as a whole;
28
No discovery of certain matters regarding information, liabilities and environmental
issues
(d)
except as Disclosed, SEAG not having discovered:
(i)
that any financial, business or other information concerning the Wider Poundland
Group publicly announced prior to the date of this Announcement or disclosed at
any time to any member of the Wider Steinhoff Group by or on behalf of any
member of the Wider Poundland Group prior to the date of this Announcement is
misleading, contains a material misrepresentation of any fact, or omits to state a
fact necessary to make that information not misleading, in any such case to a
material extent;
(ii)
that any member of the Wider Poundland Group or any partnership, company or
other entity in which any member of the Wider Poundland Group has a
significant economic interest and which is not a subsidiary undertaking of
Poundland is subject to any liability, contingent or otherwise and which is
material in the context of the Wider Poundland Group taken as a whole;
(iii)
that any past or present member of the Wider Poundland Group has not
complied with all applicable legislation, regulations or other requirements of any
jurisdiction or any Authorisations relating to the use, treatment, storage, carriage,
disposal, discharge, spillage, release, leak or emission of any waste or
hazardous substance or any substance likely to impair the environment
(including property) or harm human or animal health or otherwise relating to
environmental matters or the health and safety of humans, which noncompliance would be likely to give rise to any liability including any penalty for
non-compliance (whether actual or contingent) on the part of any member of the
Wider Poundland Group;
(iv)
that there has been a disposal, discharge, spillage, accumulation, release, leak,
emission or the migration, production, supply, treatment, storage, transport or
use of any waste or hazardous substance or any substance likely to impair the
environment (including any property) or harm human or animal health which
(whether or not giving rise to non-compliance with any law or regulation), would
be likely to give rise to any liability (whether actual or contingent) on the part of
any member of the Wider Poundland Group;
(v)
that there is or is likely to be any obligation or liability (whether actual or
contingent) or requirement to make good, remediate, repair, reinstate or clean up
any property, asset or any controlled waters currently or previously owned,
occupied, operated or made use of or controlled by any past or present member
of the Wider Poundland Group (or on its behalf), or in which any such member
may have or previously have had or be deemed to have had an interest, under
any environmental legislation, common law, regulation, notice, circular,
Authorisation or order of any Third Party in any jurisdiction or to contribute to the
cost thereof or associated therewith or indemnify any person in relation thereto;
(vi)
that circumstances exist (whether as a result of making the Offer or otherwise)
which would be reasonably likely to lead to any Third Party instituting (or
whereby any member of the Wider Poundland Group would be likely to be
required to institute), an environment audit or take any steps which would in any
such case be reasonably likely to result in any actual or contingent liability to
29
improve or install new plant or equipment or to make good, repair, reinstate or
clean up any property of any description or any asset now or previously owned,
occupied or made use of by any past or present member of the Wider Poundland
Group (or on its behalf) or by any person for which a member of the Wider
Poundland Group is or has been responsible, or in which any such member may
have or previously have had or be deemed to have had an interest, which is
material in the context of the Wider Poundland Group taken as a whole;
Anti-corruption
(vii)
any member of the Wider Poundland Group or any person that performs or has
performed services for or on behalf of any such company is or has engaged in
any activity, practice or conduct which would constitute an offence under the
Bribery Act 2010 or any other applicable anti-corruption legislation;
(viii)
any member of the Wider Poundland Group is ineligible to be awarded any
contract or business under section 23 of the Public Contracts Regulations 2006
or section 26 of the Utilities Contracts Regulations (2006) (each as amended);
(ix)
any past or present member of the Wider Poundland Group has engaged in any
activity or business with, or made any investments in, or made any payments to
any government, entity or individual covered by any of the economic sanctions
administered by the United Nations or the European Union (or any of their
respective member states) or the United States Office of Foreign Assets Control
or any other governments or supranational body or authority in any jurisdiction;
or
No criminal property
(x)
any asset of any member of the Wider Poundland Group constitutes criminal
property as defined by section 340(3) of the Proceeds of Crime Act 2002 (but
disregarding paragraph (b) of that definition).
Part B: Certain further terms of the Offer
1
Subject to the requirements of the Panel, SEAG reserves the right to waive:
(i)
any of the Conditions set out in the above Condition 1 for the timing of the Court
Meeting and General Meeting. If any such deadline is not met, SEAG shall make an
announcement by 8.00 a.m. on the Business Day following such deadline confirming
whether it has invoked or waived the relevant Condition or agreed with Poundland to
extend the deadline in relation to the relevant Condition; and
(ii)
in whole or in part, all or any of the above Conditions 2(a) to (d) (inclusive).
2
If SEAG is required by the Panel to make an offer for Poundland Shares under the
provisions of Rule 9 of the Takeover Code, SEAG may make such alterations to any of the
above Conditions and terms of the Offer as are necessary to comply with the provisions of
that Rule.
3
The Offer shall lapse if:
(a)
in so far as the Offer or any matter arising from or relating to the Scheme or Offer
constitutes a concentration with a Community dimension within the scope of the
30
Regulation, the European Commission either initiates proceedings under Article
6(1)(c) of the Regulation or makes a referral to a competent authority in the United
Kingdom under Article 9(1) of the Regulation and there is then a CMA Phase 2
Reference; or
(b)
in so far as the Offer or any matter arising from the Scheme or Offer does not
constitute a concentration with a Community dimension within the scope of the
Regulation, the Scheme or Offer or any matter arising from or relating to the Offer
becomes subject to a CMA Phase 2 Reference,
in each case, before the date of the Court Meeting.
4
Conditions 2(a) to (d) must be fulfilled or waived (if capable of waiver) by SEAG by no later
than 11.59 p.m. on the Business Day immediately preceding the date of the Court hearing to
sanction the Scheme. Subject to this obligation upon SEAG, SEAG shall be under no
obligation to waive (if capable of waiver), to determine to be or remain satisfied or to treat as
fulfilled any of Conditions 2(a) to (d) (inclusive) by a date earlier than the latest date for the
fulfilment or waiver of that Condition notwithstanding that the other Conditions of the Offer
may at such earlier date have been waived or fulfilled and that there are at such earlier date
no circumstances indicating that any of such Conditions may not be capable of fulfilment.
5
The Poundland Shares acquired under the Offer shall be acquired fully paid and free from
all liens, equities, charges, encumbrances, options, rights of pre-emption and any other third
party rights and interests of any nature and together with all rights now or hereafter
attaching or accruing to them, including, without limitation, voting rights and the right to
receive and retain in full all dividends and other distributions (if any) declared, made or paid,
or any other return of capital (whether by reduction of share capital or share premium
account or otherwise) made, on or after the date of this Announcement, save for the Agreed
Dividend.
6
If, after the date of this Announcement but prior to the Effective Date, save for the Agreed
Dividend, any dividend or other distribution is declared, paid or made or becomes payable
by Poundland, SEAG reserves the right (without prejudice to any right of SEAG, with the
consent of the Panel, to invoke Condition 2(b)(ii) above) to reduce the consideration payable
under the Offer by the aggregate amount of such dividend or distribution, and accordingly
reduce the Offer Price.
If any such dividend or distribution occurs (other than the Agreed Dividend), any reference in
this Announcement to the consideration payable or the Offer Price shall be deemed to be a
reference to the consideration or Offer Price as so reduced. If such reduction occurs,
notwithstanding the terms on which the Poundland Shares are expressed to be acquired by
SEAG pursuant to the Offer in Appendix I, the Poundland Shares shall be acquired by or on
behalf of SEAG pursuant to the Offer together with all rights now and hereafter attaching to
such shares including, without limitation, voting rights and the right to receive and retain in
full all dividends and other distributions (if any) declared, made or paid, or any other return
of capital (whether by reduction of share capital or share premium account or otherwise)
made, on or after the date of this Announcement, save for the Agreed Dividend and such
dividend or distribution in respect of which such reduction has been made, if applicable.
To the extent that such a dividend or distribution has been declared, paid, made or is
payable, it shall be (i) transferred pursuant to the Offer on a basis which entitles SEAG to
31
receive the dividend or distribution and to retain it; or (ii) cancelled, and the consideration
payable and the Offer Price shall not be subject to change in accordance with this
paragraph.
Any exercise by SEAG of its rights referred to in this paragraph shall be the subject of an
announcement and, for the avoidance of doubt, shall not be regarded as constituting any
revision or variation of the Offer.
7
SEAG reserves the right to elect (with the consent of the Panel) to implement the Offer by
way of a takeover offer as it may determine in its absolute discretion. In such event, the
acquisition shall be implemented on substantially the same terms, so far as applicable, as
those which would apply to the Scheme, subject to appropriate amendments, including
(without limitation) an acceptance condition set at 75 per cent. (or such lesser percentage,
being more than 50 per cent., as SEAG may decide) of the Poundland Shares.
8
The availability of the Offer to persons not resident in the United Kingdom may be affected
by the laws of the relevant jurisdictions. Persons who are not resident in the United Kingdom
should inform themselves about and observe any applicable requirements.
9
The Offer is not being made, directly or indirectly, in, into or from, or by use of the mails of,
or by any means of instrumentality (including, but not limited to, facsimile, e-mail or other
electronic transmission, telex or telephone) of interstate or foreign commerce of, or of any
facility of a national, state or other securities exchange of, any jurisdiction where to do so
would violate the laws of that jurisdiction.
10
The Offer is governed by the law of England and Wales and is subject to the jurisdiction of
the English courts and to the Conditions and further terms set out in this Appendix I and to
be set out in the Scheme Document. The Offer shall be subject to the applicable
requirements of the Takeover Code, the Panel, the London Stock Exchange, the Financial
Conduct Authority and the UKLA.
11
Each of the Conditions shall be regarded as a separate Condition and shall not be limited by
reference to any other Condition.
32
APPENDIX II
SOURCES OF INFORMATION AND BASES OF CALCULATION
(i)
The Cash Value of the Offer of approximately £597 million is based on 268,911,781 fully
diluted Poundland Shares consisting of:
(a)
268,701,797 Poundland Shares in issue on 12 July 2016, being the last dealing day
prior to the date of this Announcement; and
(b)
209,984 Poundland Shares in respect of awards which may vest as a result of the
Offer.
(ii)
The Closing Prices on 13 June 2016 and 12 July 2016 are taken from the Daily Official List.
(iii)
Unless otherwise stated, the financial information relating to Poundland is extracted from the
audited consolidated financial statements of Poundland for the financial year to 27 March
2016, prepared in accordance with IFRS.
(iv)
Unless otherwise stated, the financial information relating to Steinhoff is extracted from the
Quarterly Statement of Steinhoff for the nine months ended 31 March 2016.
33
APPENDIX III
IRREVOCABLE UNDERTAKINGS
Poundland Directors’ Irrevocable Undertakings
Steinhoff has received irrevocable undertakings from each of the Poundland Directors to vote in
favour of the Scheme at the Court Meeting and the resolutions to be proposed at the General
Meeting, in respect of a total of 14,719,261 Poundland Shares, representing approximately 5.5 per
cent. of the share capital of Poundland in issue on 12 July 2016 (being the latest practicable date
prior to publication of this Announcement), comprised as follows:
Name of Poundland Director
Darren Shapland
Number of Poundland
Shares in respect of which
undertaking is given
Percentage of Poundland
issued share capital
65,000
0.024%
Jim McCarthy
10,000,000
3.722%
Kevin O’Byrne
340,000
0.127%
4,254,198
1.583%
Teresa Colaianni
33,823
0.013%
Grant Hearn
10,000
0.004%
Tim Jones
3,500
0.001%
Miles Roberts
10,918
0.004%
Mary Barnard
1,822
0.001%
Nick Hateley
These irrevocable undertakings shall cease to be binding if (i) Steinhoff announces before
publication of the Scheme Document that it does not intend to proceed with the Offer and no new,
revised or replacement Scheme is announced by Steinhoff in accordance with Rule 2.7 of the
Takeover Code, or (ii) the Scheme (or takeover offer, as applicable) does not become Effective or
lapses in accordance with its terms, or is withdrawn. These irrevocable undertakings remain
binding in the event of a competing offer.
Other Poundland Shareholders
Irrevocable Undertakings
Name of Poundland
Shareholder giving
undertaking
Canada Life Investments
Number of Poundland
Shares in respect of which
undertaking is given
4,075,404
Percentage of Poundland
issued share capital
1.520
In terms of the irrevocable undertaking given by Canada Life Investments, it agrees not to dispose
of, charge, pledge or otherwise encumber or grant any option or other right over or otherwise deal
in any of the Poundland Shares beneficially owned by it, except pursuant to the Offer.
In the event that a third party announces a proposal pursuant to Rule 2.7 of the Takeover Code to
acquire the entire issued and to be issued share capital of Poundland, and such proposal provides
34
for consideration of no less than 120 per cent. of the value of the Offer Price, and Steinhoff have
not announced a higher offer on or before seven days after the date of announcement of the
higher competing offer, then all of the obligations of Canada Life Investments under its irrevocable
undertaking shall immediately lapse.
In addition, SEAG has undertaken in the Co-operation Agreement to vote in favour of the
resolutions proposed at the General Meeting in respect of its entire beneficial holding of
Poundland Shares. SEAG is not permitted to vote on the Scheme at the Court Meeting.
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APPENDIX IV
DEFINITIONS
The following definitions apply throughout this Announcement unless the context requires
otherwise:
“Agreed Dividend”
the final dividend of two pence per Poundland Share
announced in the announcement of the Poundland full
year results for the year ended 27 March 2016, dated 16
June 2016;
“Authorisations”
regulatory authorisations, orders, recognitions, grants,
consents, clearances, confirmations, certificates, licences,
permissions or approvals;
“Announcement”
this announcement made pursuant to Rule 2.7 of the
Takeover Code;
“Business Day”
a day (other than Saturdays, Sundays and public holidays
in the UK) on which banks are open for business in the
City of London;
“Cash Value”
the total cash value of 222 pence per Poundland Share,
being the aggregate of the Offer Price and the Agreed
Dividend;
“Closing Price”
the closing middle market price of a Poundland Share on a
particular trading day as derived from the Daily Official List;
“CMA Phase 2 Reference”
a reference of the Offer to the chair of the Competition and
Markets Authority for the constitution of a group under
Schedule 4 to the Enterprise and Regulatory Reform Act
2013;
“Companies Act”
the Companies Act 2006, as amended;
“Competition and Markets
Authority”
a UK statutory body established under the Enterprise and
Regulatory Reform Act 2013;
“Conditions”
the conditions to the implementation of the Offer, as set
out in Appendix I to this Announcement and to be set out in
the Scheme Document;
“Court”
the High Court of Justice in England and Wales;
“Court Meeting”
the meeting of Poundland Shareholders to be convened
pursuant to an order of the Court under the Companies Act
for the purpose of considering and, if thought fit, approving
the Scheme, including any adjournment, postponement or
reconvention thereof;
“Court Order”
the order of the Court sanctioning the Scheme;
“CREST”
the system for the paperless settlement of trades in
securities and the holding of uncertificated securities
operated by Euroclear UK and Ireland Limited;
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“Daily Official List”
the Daily Official List published by the London Stock
Exchange;
“Dealing Disclosure”
has the same meaning as in Rule 8 of the Takeover Code;
“Disclosed”
the information disclosed by, or on behalf of Poundland, (i)
in Poundland’s results announcement for the financial year
ended 27 March 2016, dated 16 June 2016; (ii) in this
Announcement; (iii) in any other announcement to a
Regulatory Information Service by, or on behalf of
Poundland prior to the publication of this announcement;
or (iv) as otherwise fairly disclosed to Steinhoff (or its
respective officers, employees, agents or advisers) prior to
the date of this announcement;
“Effective”
in the context of the Offer: (i) if the Offer is implemented by
way of a Scheme, the Scheme having become effective in
accordance with its terms, upon the delivery of the Court
Order to the Registrar of Companies; or (ii) if the Offer is
implemented by way of a takeover offer pursuant to the
terms of the Co-operation Agreement, the takeover offer
having been declared or become unconditional in all
respects in accordance with the requirements of the Code;
“Effective Date”
the date on which (i) the Scheme becomes effective; or (ii)
if SEAG elects and the Panel consents to implement the
Offer by way of a takeover offer, the takeover offer
becomes Effective;
“FCA” or “Financial Conduct
Authority”
the Financial Conduct Authority acting in its capacity as the
competent authority for the purposes of Part VI of the UK
Financial Services and Markets Act 2000;
“General Meeting”
the general meeting of holders of Poundland Shares
(including any adjournment, postponement or reconvention
thereof) to be convened in connection with the Scheme;
“IFRS”
International Financial Reporting Standards;
“J.P. Morgan Cazenove”
J.P. Morgan Limited which conducts its UK investment
banking business as J.P. Morgan Cazenove;
“Listing Rules”
the rules and regulations made by the Financial Conduct
Authority in its capacity as the UKLA under the Financial
Services and Markets Act 2000, and contained in the
UKLA’s publication of the same name;
“London Stock Exchange”
London Stock Exchange plc;
“Offer”
the recommended cash offer being made by SEAG to
acquire the entire issued and to be issued share capital of
Poundland not already directly or indirectly owned by
Steinhoff to be effected by means of the Scheme and,
where the context admits, any subsequent revision,
variation, extension or renewal thereof;
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“Offer Period”
the offer period (as defined by the Takeover Code) relating
to Poundland, which commenced on 15 June 2016;
“Offer Price”
220 pence per Poundland Share;
“Official List”
the Official List maintained by the UKLA;
“Opening Position Disclosure”
has the same meaning as in Rule 8 of the Takeover Code;
“Overseas Shareholders”
Poundland Shareholders (or nominees of, or custodians or
trustees for Poundland Shareholders) not resident in, or
nationals or citizens of the United Kingdom;
“Panel”
the Panel on Takeovers and Mergers;
“Poundland”
Poundland Group plc;
“Poundland Directors”
the directors of Poundland;
“Poundland Group”
Poundland and its subsidiary undertakings and, where the
context permits, each of them;
“Poundland Shareholders” or
“Shareholders”
the holders of Poundland Shares (excluding SEAG);
“Poundland Shares”
the shares of 1 pence each in the capital of Poundland;
“Poundland Share Plans”
the Poundland Restricted Share Plan, the Poundland
Performance Share Plan, the Poundland Company Share
Option Scheme and the Poundland Sharesave Scheme;
“Registrar of Companies”
the Registrar of Companies in England and Wales;
“Regulation”
Council Regulation (EC) 139/2004;
“Regulatory Information Service”
any of the services set out in Appendix I to the Listing
Rules;
"Restricted Jurisdiction"
any such jurisdiction where local laws or regulations may
result in significant risk of civil, regulatory or criminal
exposure if information concerning the Offer is sent or
made available to Poundland Shareholders in that
jurisdiction (in accordance with Rule 23.2 of the Takeover
Code;
“Rothschild”
N. M. Rothschild & Sons Limited;
“Scheme”
the proposed scheme of arrangement under Part 26 of the
Companies Act between Poundland and the Poundland
Shareholders in connection with the Offer, with or subject
to any modification, addition or condition approved or
imposed by the Court and agreed by Poundland and
SEAG;
“Scheme Document”
the document to be sent to holders of Poundland Shares
containing, amongst other things, the Scheme and the
notices convening the Court Meeting and the General
Meeting;
“Shore Capital”
Shore Capital Stockbrokers Limited;
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“Significant Interest”
in relation to an undertaking, a direct or indirect interest of
20 per cent. or more of the total voting rights conferred by
the equity share capital of such undertaking;
“Steinhoff”
Steinhoff International Holdings N.V.
“Takeover Code”
the City Code on Takeovers and Mergers;
“Third Party”
each of a central bank, government or governmental,
quasi-governmental, supranational, statutory, regulatory,
environmental, administrative, fiscal or investigative body,
court, trade agency, association, institution, environmental
body, employee representative body or any other body or
person whatsoever in any jurisdiction;
“UKLA”
the UK Listing Authority, being the Financial Conduct
Authority acting in its capacity as the competent authority
for the purposes of Part VI of the Financial Services and
Markets Act 2000;
“United Kingdom” or “UK”
the United Kingdom of Great Britain and Northern Ireland;
“United States” or “US”
the United States of America, its territories and
possessions, any state of the United States of America,
the District of Columbia and all other areas subject to its
jurisdiction and any political sub-division thereof;
“Wider Poundland Group”
Poundland and associated undertakings and any other
body corporate, partnership, joint venture or person in
which Poundland and such undertakings (aggregating their
interests) have a Significant Interest; and
“Wider Steinhoff Group”
Steinhoff and associated undertakings and any other body
corporate, partnership, joint venture or person in which
Steinhoff and all such undertakings (aggregating their
interests) have a Significant Interest.
For the purposes of this Announcement, “subsidiary”, “subsidiary undertaking”, “undertaking”
and “associated undertaking” have the respective meanings given thereto by the Companies
Act.
All references to “pounds”, “pounds Sterling”, “Sterling”, “£”, “pence”, “penny” and “p” are to the
lawful currency of the United Kingdom.
All references to “Euros”, “EUR” and “€” are to the lawful currency of the member states of the
European Union that adopt a single currency in accordance with the Treaty establishing the
European Community as amended by the Treaty on the European Union.
All the times referred to in this Announcement are London times unless otherwise stated.
References to the singular include the plural and vice versa.
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