Steinhoff says Britain's Poundland rejects takeover offer proposal

(Adds detail, analyst comment)

JOHANNESBURG, June 24 (Reuters) - Steinhoff said on Friday Britain's Poundland's board had rejected a proposal about a possible takeover offer, another blow to the South African retailer's ambitions to expand in Europe.

Steinhoff, which listed in Frankfurt last year for easier access to capital, bought a 23 percent stake in no-frills retailer Poundland and was considering a full cash bid, the company said on June 15.

But Poundland's board had not accepted a proposal regarding a possible cash offer for the rest of the firm, Steinhoff said, making a hostile bid a possibility.

"The Board of Steinhoff is considering its position and a further announcement will be made in due course," it said.

But the company will be cautious and wait to see where Poundland's share price settles, said Avior Capital Markets analyst Mark Hodgson.

"The lower it goes, the more attractive a Steinhoff buyout offer will look to (Poundland) shareholders," said Hodgson

Since the proposal to Poundland's board, the British retailer reported a 13.5 percent decline in full-year profit and on Friday its shares tumbled along with other UK retailers after Britain voted to exit the European Union.

Shares (Berlin: DI6.BE - news) in Poundland were down more than 10 percent at 184.25 pence by 1247 GMT, outpacing a 3.8 percent drop in the FTSE 100 .

Steinhoff, which sells beds and cupboards to lower-income shoppers in Europe, southern Africa and Asia, is keen to expand further in Europe, where pressure on consumer income has made Germany's Aldi the continent's fastest growing supermarket chain.

But the company has lost out in two other takeovers in Europe this year. It (Other OTC: ITGL - news) failed to win Britain's Home Retail (Other OTC: HMRLF - news) , which owns Argos, and was unsuccessful in a bid for Darty (Other OTC: KESAF - news) in France. (Reporting by TJ Strydom; Editing by Tiisetso Motsoeneng)