Steinhoff’s shares plunge on CEO exit
SHARES in SA-based retail giant Steinhoff fell almost 60% yesterday after the company announced the resignation of its CEO in the wake of accounting irregularity allegations.
The release of the company's full-year results – originally scheduled for yesterday – has been delayed indefinitely. The German-listed firm’s stock lost 58% to trade at ($1.48, R20) on the Frankfurt stock exchange, giving it a market capitalisation of billion (R91-billion) and over 56% on the JSE. The shares plunge for the firm – which owns Conforama in France, Poundland in Britain, Poco in Germany and Pep in southern Africa – follows news that CEO Markus Jooste resigned. The board has asked auditor PWC to investigate the allegations. Chairman Christo Wiese will step in as interim CEO.
Steinhoff’s holding company is based in Amsterdam for tax reasons and its primary listing is on the Frankfurt stock exchange.
Its African businesses include a range of credit-based household goods retailers. The firm has a reputation for being highly acquisitive, snapping up retail chains across the world.
“The supervisory board of Steinhoff wishes to advise shareholders that new information has come to light today which relates to accounting irregularities requiring further investigation,” the firm said. “Steinhoff will update the market as the aforesaid investigation proceeds.”
The company stressed that it still had profitable businesses in its portfolio and urged investors to “exercise caution” when trading its shares in the wake of the disclosures.
Steinhoff almost merged with Shoprite earlier this year to form Africa’s largest retailer, but the plans were scrapped in February. — AFP