DGAP-News: Steinhoff International N.V.

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This announcement is not an offer of securities for sale or subscription in the United States or any other jurisdiction. This announcement is not a prospectus and not an offer to sell, or a solicitation of an offer to subscribe for or to acquire, securities in the United States or any other jurisdiction, including in or into the United States, Australia, Canada, Japan or South Africa. Neither this announcement nor anything contained herein shall form the basis of, or be relied upon in connection with, any offer or commitment whatsoever in any jurisdiction.

STEINHOFF AFRICA RETAIL LIMITED ("STAR") ANNOUNCES ITS INTENTION TO FLOAT ON THE JSE MAIN BOARD

STELLENBOSCH, 23 August 2017, Steinhoff Africa Retail Limited ("STAR" or the "Company"), a wholly owned subsidiary of Steinhoff International Holdings N.V. ("Steinhoff"), is pleased to announce its intention to list its issued ordinary share capital on the main board of the securities exchange operated by the JSE Limited (the "JSE"), subject to market conditions and approval by the JSE (the "Listing"), which is still expected to be completed before the end of September 2017.

STAR is a leading low-cost retailer servicing value-conscious consumers in Sub-Saharan Africa. With over 4 800 stores to date, STAR has one of the largest retail footprints in the region and has a proven and sustainable price leadership strategy across multiple brands and retail categories that is based upon sourcing products at low cost and distributing them through STAR's extensive retail platform. The Company operates across various stable and growing sectors, including apparel, footwear, household goods, furniture, consumer electronics, appliances, general merchandise and building materials, while also providing financial and mobile services.

STAR was established on 1 July 2017 following an internal restructuring by Steinhoff of its African retail assets ("the STAR Group"). Since Steinhoff will continue to be a controlling shareholder in the Company, the STAR Group will continue to leverage off Steinhoff's strategic expertise, centralised sourcing, manufacturing and logistics expertise in order to maximise operating efficiencies across its retail operations following the Listing.

More information on the STAR Group will be available on the Company's website: www.steinhoffafricaretail.co.za

KEY STRENGTHS AND COMPETITIVE ADVANTAGES

The following key strengths and competitive advantages are expected to contribute to the continued growth and success of the STAR Group:

- retail champion with largest footprint in formalising African market;

- high exposure to Africa's emerging consumer class;

- defensive discount model winning in a changing consumer environment;

- "Best Price Leadership" strategy effective in developing customer loyalty and volume growth;

- established multi-brand strategy offerings across the entire discount and value spectrum;

- nationwide coverage in key African markets serving customers at their convenience;

- superior supply chain management expertise and extensive sourcing scale, protecting prices;

- strong organic and innovative growth opportunities and initiatives;

- highly cash generative and robust operating model with track record of strong financial performance; and

- innovative and experienced management team, with loyal and committed employees.

GROWTH STRATEGY

The STAR Group's vision is to be the preferred destination for delivering value to the African consumer and all other stakeholders. The STAR Group seeks to do this by providing everyday products at affordable prices and serving customers at their convenience, and aims to achieve this strategy through various organic and innovative growth opportunities and initiatives, which include, among others, the roll-out of new stores, leveraging its store footprint to capitalise on virtual product development, increasing its market share in financial and other services, entry into new product offerings and services, and leveraging group synergies and operating platforms to lower costs. The STAR Group will also continue to explore categories of products and services in which it has low market shares with a view to expand in these areas.

KEY FINANCIAL METRICS AND OUTLOOK

For the 12 months ended 30 September 2016, the STAR Group reported revenue of R51 234 million, earnings before interest and tax and capital items ("EBIT") of R3 485 million and earnings before interest, tax, depreciation and amortisation and capital items ("EBITDA") of R4 397 million.

During the periods under review the STAR Group made two sizeable acquisitions and implemented a brand consolidation and restructure of the furniture operations. These acquisitions, the consolidation and the restructure will have a positive impact on the performance of STAR going forward. After adjusting for the acquisitions and one-off brand consolidation and restructuring related expenditure, the STAR Group would have reported EBIT of R4 855 million and EBITDA of R5 776 million on a pro-forma basis for the 12 months ended 30 September 2016.

Looking ahead, after the aforementioned adjustments, the STAR Group expects to achieve pro forma EBIT of R6 063 million and pro-forma EBITDA of R7 016 million for the 12 months ending 30 September 2017 ("FY17"). STAR expects to list with approximately two times net debt to FY17 EBITDA ratio. Further store openings and organic initiatives will provide opportunities for expanding operating margin and maintaining strong growth momentum.

THE PRIVATE PLACEMENT AND LISTING

In conjunction with the Listing, the Company expects to make an offer to certain selected investors to subscribe for ordinary shares in the Company by way of a private placement (the "Private Placement"). Any offer to subscribe for ordinary shares in the Company pursuant to the Private Placement will be made, and any investor should make his investment decision, solely on the basis of the information that is contained in the Pre-listing Statement to be published by STAR in due course (the "Pre-listing Statement"). The Private Placement will be offered to and only be capable of acceptance by, certain qualifying investors and will not be an offer to the public in any jurisdiction.

THE SHOPRITE TRANSACTION

As announced on 4 August 2017 ("the Announcement"), the STAR Group has secured options which, once exercised, will result in STAR acquiring a strategic investment in Shoprite Holdings Limited ("Shoprite"), one of Africa's leading food and grocery retailers with a track record of successful growth and expansion in South Africa and across the continent ("Call Options"). Further details on the Call Options were contained in the Announcement and will be detailed in the Pre-listing Statement.

Stellenbosch

23 August 2017

JOINT GLOBAL COORDINATOR	JOINT GLOBAL COORDINATOR		JOINT GLOBAL COORDINATOR		JOINT GLOBAL COORDINATOR
JOINT BOOKRUNNER		JOINT BOOKRUNNER		TRANSACTION AND CORPORATE SPONSOR

ENQUIRIES

Steinhoff & STAR: Mariza Nel, +27 (0)21 808 0711;

Citigroup: Patrick Evans, +44 (0)20 7986 1931; Nick Pagden, +27 (0)11 944 0000;

Investec: Carlyle Whittaker, +27 (0)11 286 9994; Hugo Steyn, +27 (0)21 416 3314;

Morgan Stanley: Mark Maislish, +44 (0)20 7425 9059;

RMB: Stephen Friesenecker, +27 (0)11 282 4505

DISCLAIMER

The contents of this announcement have been prepared by and are the sole responsibility of STAR.

The information contained in this announcement is for background purposes only and does not purport to be full or complete. No reliance may be placed by any person for any purpose on the information contained in this announcement or its accuracy, fairness or completeness.

This announcement is not for publication or distribution, directly or indirectly, in or into the United States (including its territories and possessions, any State of the United States and the District of Columbia), Australia, Canada or Japan. The distribution of this announcement may be restricted by law in certain jurisdictions and persons into whose possession any document or other information referred to herein should inform themselves about and observe any such restriction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

This announcement does not constitute or form a part of any offer or solicitation to purchase or subscribe for securities to any person in the United States, Australia, Canada or Japan or in any jurisdiction to whom or in which such offer or solicitation is unlawful. The securities referred to herein (the "Shares") may not be offered or sold in the United States unless registered under the U.S. Securities Act of 1933, as amended (the "Securities Act") or offered in a transaction exempt from, or not subject to, the registration requirements of the Securities Act. The offer and issue of the Shares has not been, and will not be, registered under the Securities Act or under the applicable securities laws of Australia, Canada or Japan. Subject to certain exceptions, the Shares referred to herein may not be offered or sold in Australia, Canada or Japan or to, or for the account or benefit of, any national, resident or citizen of Australia, Canada or Japan. There will be no public offer of securities in the United States, Canada, Australia and Japan.

This announcement does not constitute or form a part of any offer or solicitation or advertisement to purchase and/or subscribe for Shares in South Africa, including an offer to the public for the sale of, or subscription for, or the solicitation of an offer to buy and/or subscribe for, shares as defined in the South African Companies Act No. 71 of 2008 ("South African Companies Act"), as amended and will not be distributed to any person in South Africa in any manner that could be construed as an offer to the public in terms of the South African Companies Act. In South Africa this announcement is directed only at (i) persons falling within the exemptions set out in section 96(1)(a) or (ii) persons who subscribe, as principal, for Shares at a minimum aggregate subscription price of R1 000 000, as envisaged in section 96(1)(b), of the Act (all such persons in (i) and (ii) being referred to as "relevant persons"). The Private Placement and any other investment activity to which this announcement relates will only be available to, and will only be engaged with, relevant persons. Any person who is not a relevant person should not act on this announcement or any of its contents. This announcement does not, nor does it intend to, constitute a "registered prospectus", as contemplated by the South African Companies Act.

The information contained in this announcement constitutes factual information as contemplated in section 1(3)(a) of the South African Financial Advisory and Intermediary Services Act, 37 of 2002, as amended and should not be construed as an express or implied recommendation, guide or proposal that any particular transaction in respect of the Shares or in relation to the business or future investments of the Company is appropriate to the particular investment objectives, financial situations or needs of a prospective investor, and nothing in this announcement should be construed as constituting the canvassing for, or marketing or advertising of, financial services in South Africa.

In member states of the European Economic Area (each, a "Relevant Member State"), this announcement and any offer if made subsequently is directed only at persons who are "qualified investors" within the meaning of the Prospectus Directive ("Qualified Investors"). For these purposes, the expression "Prospectus Directive" means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in a Relevant Member State), and includes any relevant implementing measure in the Relevant Member State and the expression "2010 PD Amending Directive" means Directive 2010/73/EU. In the United Kingdom this announcement is directed exclusively at Qualified Investors (i) who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Order") or (ii) who fall within Article 49(2)(A) to (D) of the Order, and (iii) to whom it may otherwise lawfully be communicated, and any investment activity to which it relates will only be engaged in with such persons and it should not be relied on by anyone other than such persons.

Copies of this announcement are not being made and may not be distributed or sent into the United States, Canada, Australia or Japan.

This announcement may include statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements may be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "plans", "projects", "anticipates", "expects", "intends", "may", "will" or "should" or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. Forward-looking statements may and often do differ materially from actual results. Any forward-looking statements reflect the Company's current view with respect to future events and are subject to risks relating to future events and other risks, uncertainties and assumptions relating to the Company's business, results of operations, financial position, liquidity, prospects, growth and strategies. Forward-looking statements speak only as of the date they are made. Kindly note that any forecast financial information contained in this announcement has not been reviewed and reported on by Steinhoff's or STAR's auditor in accordance with paragraph 8.40(a) of the Listings Requirements of the JSE.

Each of the Company, Steinhoff, Citigroup, Investec, J.P. Morgan, Morgan Stanley, PSG Capital, RMB and Standard Bank and their respective affiliates expressly disclaims any obligation or undertaking to update, review or revise any forward looking statement contained in this announcement whether as a result of new information, future developments or otherwise.

Any subscription of Shares in the proposed Private Placement should be made solely on the basis of the information contained in the Pre-listing Statement to be issued by the Company in connection with the Private Placement. The information in this announcement is subject to change. Before subscribing for or purchasing any Shares, persons viewing this announcement should ensure that they fully understand and accept the risks which will be set out in the Pre-listing Statement when published. No reliance may be placed for any purpose on the information contained in this announcement or its accuracy or completeness. This announcement does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for any Shares or any other securities nor shall it (or any part of it) or the fact of its distribution, form the basis of, or be relied on in connection with, any contract therefor.

The date of the Listing may be influenced by a variety of factors which include market conditions. There is no guarantee that Listing will occur and you should not base your financial decisions on the Company's intentions in relation to Listing at this stage. Acquiring investments to which this announcement relates may expose an investor to a significant risk of losing all of the amount invested. Persons considering making such investments should consult an authorised person specialising in advising on such investments. This announcement does not constitute a recommendation concerning the Private Placement. The value of shares can decrease as well as increase. Potential investors should consult a professional advisor as to the suitability of the Private Placement for the person concerned.

None of Citigroup, Investec, J.P. Morgan, Morgan Stanley, PSG Capital, RMB and Standard Bank or any of their respective directors, officers, employees, advisers or agents accepts any responsibility or liability whatsoever for/or makes any representation or warranty, express or implied, as to the truth, accuracy or completeness of the information in this announcement (or whether any information has been omitted from the announcement) or any other information relating to the Company, its subsidiaries or associated companies, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of the announcement or its contents or otherwise arising in connection therewith.

Each of Citigroup, Investec, J.P. Morgan, Morgan Stanley, PSG Capital, RMB and Standard Bank is acting exclusively for STAR and Steinhoff and no-one else in connection with the Private Placement. They will not regard any other person as their respective clients in relation to the Private Placement and will not be responsible to anyone other than STAR and Steinhoff for providing the protections afforded to their respective clients, nor for providing advice in relation to the Private Placement, the contents of this announcement or any transaction, arrangement or other matter referred to herein.

Morgan Stanley is authorised in the United Kingdom by the PRA and regulated in the United Kingdom by the PRA and FCA.

In connection with the Private Placement, each of Citigroup, Investec, J.P. Morgan, Morgan Stanley, RMB and Standard Bank and any of their respective affiliates, may take up a portion of the Shares as a principal position and in that capacity may retain, purchase, sell, offer to sell or otherwise deal for their own accounts in such Shares and other securities of STAR or related investments in connection with the Private Placement or otherwise. Accordingly, references in the Pre-listing Statement, once published, to the Shares being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by any of Citigroup, Investec, J.P. Morgan, Morgan Stanley, RMB and Standard Bank and any of their respective affiliates acting in such capacity. In addition, Citigroup, Investec, J.P. Morgan, Morgan Stanley, RMB and Standard Bank may enter into financing arrangements and swaps in connection with which they or their affiliates may from time to time acquire, hold or dispose of Shares. None of Citigroup, Investec, J.P. Morgan, Morgan Stanley, RMB and Standard Bank nor any of their respective affiliates intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.

In connection with the Private Placement, the Company may appoint a stabilisation manager, who may, subject to the JSE Listings Requirements and other applicable law, over-allot Shares or effect other transactions with a view to supporting the market price of the Shares at a level higher than that which might otherwise prevail for a limited period after the date of the Listing. However, there will be no obligation on the stabilisation manager to do so. Such stabilising action may under no circumstances continue beyond the 30th calendar day after the date of the Listing.

Unless otherwise indicated, market, industry, market share and competitive position data are estimates (and accordingly, approximate) and should be treated with caution. Such information has not been audited or independently verified, nor has the Company ascertained the underlying economic assumptions relied upon therein.