Furniture group to eliminate debts
Homestyle Group hopes to generate£100 million through a refinancing programme. The funds will be raised through the issue of 190.9 million new ordinary shares at 55p each.

Shares worth£116 million will go to a subsidiary of Steinhoff International Holdings. The rest will be distributed in an open offer to qualifying shareholders, which Steinhoff will fully underwrite. The deal means that Steinhoff will hold 45 per cent of the retailer's enlarged share capital.

The proceeds of the refinancing programme will be used to pay Homestyle's bank facilities, settle outstanding VAT debt and fund ongoing development. Two key areas of focus will be the continued development of the retailer's beds business and the recovery of its furniture division.

Homestyle chairman David Brock commented on the advantages the relationship with Steinhoff will bring, as a dominant supplier of household goods throughout the world.

He said: 'The proposed refinancing provides an excellent opportunity for the group to eliminate its indebtedness and benefit from a strong partnership with one of largest international household goods groups.'