Stock Steinhoff above R3 coin for the first time since April

The Steinhoff [JSE:SNH] share crossed for the first time the level of Friday's R3 shares in three months as investors reacted to its latest update on restructuring.

The shares of the besieged global distributor have been rising – albeit on a weak base – since Wednesday.

Friday at 13:27, the action of Steinhoff changes hands at R3.15 per share, up 9.4% on the day. In the latest update on the restructuring, Steinhoff International said it had begun a consent process for a lock-up deal as part of the group's financial debt restructuring, "said Makoni Musa, a specialist in trading on GT247.com.

Shares of the retail conglomerate domiciled in Stellenbosch fell in early December 2017 when CEO Markus Jooste resigned after the auditors reported accounting irregularities in his financial statements.

The company, which is the subject of an ongoing forensic investigation by PwC, has announced a loss of R2.4bn operating for the first half of the fiscal year end of June. The Hawks, meanwhile, continue to investigate three cases related to allegations of fraud in the company and its subsidiaries.

Makoni said that if the company managed to implement the restructuring in three months as planned, its ability to continue as the continuity of operations would seem more feasible.

"Given the tightening of liquidity that the company has been facing since December, it gives them a little respite and stability," he said.

"This is attractive to investors who might have jumped off the ship because uncertainty reigned following the revelations of December 2017, hence the significant rise in the price of the stock."

While the stock price has doubled in recent days still down more than 90% from the day before Jooste resigns abruptly.

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