The proceeds of this will be utilised to reduce JD Group’s debt, primarily the redemption of the JD Group Convertible Bonds.
“The executive management of JD Group is focused on implementing the remedial steps necessary to restore JD Group to operational profitability. The JD Group board of directors has resolved that the funding and treasury function of JD Group should in future be undertaken by Steinhoff, as part of the latter’s central treasury function,” [DATA JDG:JD Group] said.
(READ MORE: JD Group’s results affected by low consumer spending)
“As a consequence, JD Group’s funding requirements have shifted to Steinhoff central treasury and will henceforth be represented as a Steinhoff shareholder’s term loan at market related terms.”
Steinhoff International recently extended the tender offer closing date for its acquisition of up to 98 per cent of the issued ordinary shares in JD Group.
(READ MORE: Steinhoff extends JD Group tender offer date)
“In order to afford such JD Group shareholders the opportunity to participate in the tender offer, and to facilitate the administrative process associated with the tender offer, JD Group shareholders are hereby notified that the closing date will be extended until the close of business on 4 April 2014,” [DATA SHF:Steinhoff LTD.] had said.
“JD Group is facing many challenges in the furniture retail and consumer finance business segments. These challenges will take some time and additional capital to overcome. The increase of Steinhoff’s investment in JD Group, in an expedient manner, will enhance Steinhoff’s ability to support the operations of JD Group.”
According to JD Group, the finalisation announcement in respect of the rights offer is expected to be released on or before 29 May 2014.