Furniture group Steinhoff is set to acquire Africa’s largest retailer, Shoprite. What the story behind the firm that wants to be Africa’s next IKEA? Here’s a brief history of Steinhoff:
- Bruno Steinhoff founded the company in Germany in 1963. He did so in order to source furniture from the communist-ruled eastern Europe to sell in western Europe.
- When the Berlin Wall fell in 1989, Steinhoff grasped huge opportunities in the household goods industry and expanded to former East Germany, Poland, Hungary and the Ukraine.
- Steinhoff Europe was created, and the firm invested in its production and distribution capacity.
- Steinhoff Africa was formed in 1997 when the firm acquired an interest in furniture manufacturers Gommagomma Holdings.In 1998, Steinhoff was listed on the Johannesburg Stock Exchange (JSE). Steinhoff committed to sourcing and manufacturing products in low-cost locations and retailing them in developed markets.
- In 1998, the Chairman of Steinhoff stated: “Logistics is a huge growth area for us with warehousing and distribution networks being key to the future”.Between 1998-2002, Steinhoff worked on “establishing its base”.
- In 2000, it developed its manufacturing capacity in Poland. Steinhoff’s German production largely relocated to Poland and acquired numerous Polish factories.
- The following year, Steinhoff acquired UK bedding manufacturers Relyon Group, Australian retailer Sprung Slumber and the Australian manufacturing facilities of Freedom Group.
- In 2002, Steinhoff acquired high-end European brands Egoform and Dieter Knoll.
- In 2005, the company looked to vertically integrating its pillars of business. It established itself in retail, in order to complement its presence in manufacturing, sourcing and logistics service. It acquired retail group Freedom in Australia and New Zealand, UK retail group Homestyle and Unitrans UK.
- The firm bought Conforma, Europe’s second largest retailer of home furnishing, in 2011.
- Steinhoff International moved its primary listing to the Frankfurt Stock Exchange in 2015. However, management remained in South Africa.
- In 2016, Steinhoff took over UK discount retail chain Poundland in a £597 million deal and bought Mattress Firm for $3.8 billion.
Investment and analytics firm Vestact predicted that Retail Africa will have annual revenues of 200 billion rand (over 14 billion dollars).
| African BusinessReview | Dec 19, 2016 |