Moody’s rates Steinhoff notes Baa3

Moody's Investors Service said it assigned a Baa3 rating to the new senior unsecured notes that Steinhoff Europe AG plans to issue and will be unconditionally and irrevocably guaranteed by Steinhoff International Holdings NV.

The outlook is stable.

The note offering is consistent with Moody's expectations of Steinhoff's funding plans as incorporated in the company's ratings, including the Baa3 long-term issuer rating and Aa1.za national scale issuer rating assigned at Steinhoff Investment Holdings Ltd.

Net proceeds will be used primarily to repay existing financial debt.

The benchmark size notes issuance (about €500 million) will rank pari passu with all other existing and future unsecured and unsubordinated debt obligations of Steinhoff.

Moody’s said the Baa3/Aa1.za ratings reflect Steinhoff's: (a) Large scale; (b) broad business and geographic diversification; and (c) ability to extract volume-driven cost benefits from a vertically integrated supply chain and retail offering which deliver EBITDA growth.

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