Nicola Mawson
27 August 2007
Johannesburg — FURNITURE retailer Steinhoff and appliance company Amalgamated Appliances Holdings (Amap) have put their relationship on ice after merger discussions collapsed.
Two Steinhoff directors have quit the Amap board, although Steinhoff said on Friday it would retain its 26,7% interest in the appliance company as a "long-term investment".
Amap said that because the merger discussions had failed and Steinhoff had subsequently sold its local furniture manufacturing interests to a private equity consortium, "the nature of Steinhoff's investment in Amap has changed".
Earlier this month, Steinhoff said it had received Competition Tribunal approval in May for its R1,375bn sale of its local furniture manufacturing interests to a consortium led by Absa Capital and management .
In April, a dispute over the valuation of the unit scuppered its sale to Amap. Steinhoff Africa planned to sell Steinfurn for R1,152bn, to be paid for by R665m in cash and shares, but two of Amap's major shareholders disagreed with the valuation. The deal would have slightly increased Steinhoff's stake in Amap.
On Friday, Amap said there was no longer potential for synergies between them, and a conflict of interest might arise from Steinhoff's retail ambitions.
Amap said Steinhoff CEO Markus Jooste and executive Danie van der Merwe had resigned from its board.
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