Steinhoff Ups Offer For Poundland To £610m

High street chain Poundland has agreed to a higher takeover offer from South African retailer Steinhoff.

The revised offer, which Steinhoff has said is final, values the discount chain at £610m, an increase of 2% on its provisional offer of £597m in July.

It comes after US hedge fund Elliot, which has a track record of "bumptrage" and playing a part in pushing for a better offer in takeovers, increased its stake in Poundland.

"The Poundland board is pleased to recommend Steinhoff Europe's increased all-cash offer which presents Poundland shareholder with an opportunity to realise their shareholding at an improved price," said chairman Darren Shapland.

Poundland, which has more than 900 stores across the UK and Ireland (Other OTC: IRLD - news) and employs around 18,000 staff, has agreed to the offer of 227p per share including a 2p dividend.

Steinhoff International said the chain, would be a "complementary fit" for its growth ambitions across Europe, but maintained it had no plans to change the group's head office near Wolverhampton or employment conditions for staff.

Markus Jooste, chief executive, said: "By offering Poundland shareholders an improved cash offer we aim to bring certainty to the transaction recognising the strength and value of the business and its management team."

Steinhoff, which owns UK furniture firm Harveys and Bensons For Beds, recently lost out in a battle with Sainsbury (Amsterdam: SJ6.AS - news) 's to buy Argos owner Home Retail Group in March.

Shares (Berlin: DI6.BE - news) at Poundland dropped 1% following the announcement.