Steinhoff Asia Pacific Holdings' $3.50-a-share bid is 43 per cent above the stock's last trading price. It has the support of Fantastic's two key shareholders, chairman Julian Tertini and former finance director Peter Brennan, as well as the board in the absence of a superior offer and subject to an expert's report.

Shares in Fantastic soared as much as 42.04 per cent to $3.48, their highest level since May 3, 2010. They were 40.4 per cent higher at $3.44 at 1.14pm.

Grant Oshry, of 10-per-cent shareholder Perennial Value Management, said the bid was a "good outcome" after Fantastic had "lost its way" during the financial crisis. At the start of the year, Perennial called on Fantastic to consider privatisation due to the company quickly losing key executives and concerns over corporate governance. 

"We're pleased that they've voted in favour of this scheme with Steinhoff and in the absence of a higher bid we will be accepting this offer," Mr Oshry said.

Fantastic chairman and 30.75 per cent shareholder Mr Tertini said the South African company "shares our vision for the growth and expansion of Fantastic Holdings and, as such, we believe they are the right long-term partner for our customers, employees, suppliers and other stakeholders".

Steinhoff Asia Pacific director Tim Schaafsma said Fantastic would broaden the company's stable of brands and accelerate its growth in the region.

Steinhoff Asia Pacific already owns furniture and homeware brands Freedom, Snooze, POCO and Bay Leather Republic in Australia, as well as mattress manufacturing business, Selectopedic.

It was recently speculated to also be interested in Woolworths's discount department store chain Big W, as well as The Good Guys, which ended up being bought by JB Hi-Fi.

Fantastic shareholders will vote on the bid in early December, with the deal expected to be wrapped up by the end of the year if it gets the nod from shareholders, the Federal Court and the Foreign Investment Review Board.