Background

The dramatic collapse of the share price of Steinhoff International ("SNH" or "Steinhoff") since last Friday, 1 December 2017, has been very topical.

 This update seeks to provide the stakeholders with information about the impact of this decline on the value and financial position of the Fund.

Context

The story about Steinhoff International revolves around the allegations of serious accounting irregularities that have been levelled by the European financial authorities. The CEO (Mr. Markus Jooste) has resigned from Steinhoff with immediate effect while the non-executive chairman (Mr. Christo Wiese) has stepped in as Executive Chairman.

The company has appointed PwC (who are not the external auditors of Steinhoff) to perform an independent investigation into the allegations. The current external auditors of Steinhoff are Deloitte and have performed the external auditor function since 1998.

The SNH share price has fallen by more than 80% since the end of November 2017, including a 60% drop in one day on 6 December 2017. The share was trading at a price of R11.10 on the morning of 7 December 2017.

The impact on the Fund

The drastic share decline has had a negative impact on the markets in general and on the Fund in particular. Hence, while the Fund was negatively impacted, this fall has not been too severe when compared to the equity benchmark. SNH represented only about 1.2% of our total assets

Conclusion

The Fund is well-diversified and has enough assets to meet its liabilities. The Fund's management is monitoring the situation and will continue to respond proactively and responsibly in the best interests of our stakeholders.

We hope that the information provided is in order. Should there be further developments, we will ensure that we update stakeholders accordingly.