South African manufacturing group Steinhoff and its European subsidiary mounted a 100p a share offer to buy the furniture retailer. The outstanding Homestyle shares represent about 39 per cent of the shares in issue.
Steinhoff refinanced Homestyle in July last year, when it also took a 61 per cent stake in the retailer, which owns the Harveys and Bensons Beds chains.
According to furniture trade sources, the Harveys promotion of£199 and£299 leather sofas, together with the introduction of Steinhoff ranges, have not been a great success. Both the managing director and financial director of Harveys have also left the company in the past few months.
Homestyle chairman Donald Macpherson said: 'While progress is being made in improving many areas of our business, restoring acceptable levels of performance across the Homestyle Group is a long-term project and we believe profitability will be restored more rapidly under the ownership structure proposed by Steinhoff.'
Seymour Pierce analyst Richard Ratner said: 'One can only conclude that the offer is simply a face-saving exercise, as we believe that our reduced forecast (prior to the bid) of£6 million, which was almost£10 million lower than the house broker's forecast at the time, might prove to be elusive.'
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