* Move could complicate Steinhoff's takeover of Poundland
* Steinhoff says could be hit by pound's slump post-Brexit vote
* Shares down 6 percent after sales miss estimates (Updates with Elliott stake, shares fall)
By Tiisetso Motsoeneng
JOHANNESBURG, Aug 31 (Reuters) - Activist U.S. hedge fund Elliott Capital has raised its stake in British discount chain Poundland to 22.7 percent, putting it in a position to be able to block an agreed takeover by South African retailer Steinhoff.
The move could be another setback for Steinhoff, which warned on Wednesday that a slump in the pound after Britain's vote to leave the European Union could hurt its UK business.
Steinhoff raised its agreed offer for Poundland to 610 million pounds ($790 million) on Aug. 11 and said the revised terms were final, challenging Elliott Capital to back the deal or risk its collapse.
Poundland shareholders will vote before an investor meeting on Sept. 7 to decide whether to approve the deal.
Elliott has been building its stake since Steinhoff's offer was announced and regulatory filings on Wednesday showed its stake had reached 22.7 percent.
It is unclear what Elliott's motivations are but the $28-billion hedge fund founded by American billionaire Paul Singer has a track record of buying stakes in companies in play and then getting bidders to increase their offers.
Steinhoff, which has a 23.6 percent holding in Poundland, requires the support of 75 percent of Poundland shareholders, excluding its own stake, for the deal to go through.
Given that Steinhoff has maintained its offer was final, the deal could collapse if Elliot is seeking a higher offer.
A Steinhoff spokeswoman could not immediately be reached for comment outside regular office hours.
The Poundland deal is part of an international acquisition spree that Steinhoff has embarked on since 2011 aimed at reducing its exposure to a deteriorating home market.
Shares in Steinhoff fell 5.7 percent in Johannesburg on Wednesday after the company narrowly missed estimates for annual sales.
Steinhoff, which already runs the Benson for Beds and Harveys furniture chains in the UK, said on Wednesday that Britain's shock vote to leave the EU could affect its earnings.
"While the effect of this (Brexit) decision on consumer demand across Europe remains uncertain, the devaluation of the pound sterling may also result in an unfavourable effect when translating our businesses' earnings reported in euro," it said.
Sterling hit a three-decade low of $1.2798 in July in the wake of the vote for Brexit. It has since recovered about 2 percent, but is still around 12 percent lower than it was before the June 23 referendum on EU membership.
Shares in Steinhoff, which have gained about 20 percent so far this year, fell 5.7 percent to 88.22 rand ($6.39) in Johannesburg, their biggest one-day percentage fall since June 27. The stock was down by the 7 percent in Frankfurt at 5.39 euros.
Steinhoff, a $25 billion company that also sells clothes, reported a one-third rise to 13.1 billion euros in annual sales on Wednesday thanks to a strong performance from its European business, where it also runs Conforama in France.
But that was slightly below a 13.2 billion euro ($14.71 billion) estimate by Thomson Reuters StarMine's SmartEstimates. Operating profit rose 32 percent to 1.5 billion euros.
Its European businesses boosted household goods' revenue by 15 percent to 7.2 billion euros, while its African furniture businesses' revenue dropped 18 percent as debt-laden consumers cut back on big-ticket items.
Steinhoff is due to report its full results next Tuesday.
Steinhoff said earlier this month it would buy U.S. company Mattress Firm for $3.8 billion including debt, which would give it a big presence in the world's biggest retail market ($1 = 0.8972 euros) ($1 = 0.7607 pounds) ($1 = 14.4051 rand) (Reporting by Tiisetso Motsoeneng; Additional reporting by Sarah Young in London; Editing by Louise Heavens and Adrian Croft)