Poundland in fightback as crisis deepens

by James Burton and Hannah Uttley POUNDLAND has distanced itself from owner Steinhoff as an accounting scandal threatens to derail the South African investment firm.

Steinhoff has lost two chief executives this month amid a fraud scandal which has seen shares crash more than 87pc, wiping £7.5bn off its value.

Yesterday, the Stellenbosch head quartered company warned investors it is losing support from its banks because of the crisis.

Steinhoff bought the High Street budget retailer for £597m in 2016, and the crisis engulfing it has led to questions about the bargain chain’s 802 UK stores and 18,000 staff.

But in a letter to workers, bosses Sean Cardinaal and Barry Williams insisted Poundland remains a successful business – regardless of problems with its parent firm. They said: ‘We’re confident once insurers fully understand our position – trading strongly and independent of Steinhoff – they will be able to offer additional reassurance to our suppliers.’

They added they are still excited about Poundland’s future. ‘Nothing that’s happening thousands of miles away in South Africa will change that,’ they said.

Steinhoff has £15bn of debt, with private investors and a string of global banks including Goldman Sachs and HSBC braced for heavy losses. It has promoted chief operating officer Danie van der Merwe to chief executive.

He replaces Christo Wiese, the largest shareholder, who has quit as the scandal grew.

Wiese replaced Markus Jooste who stood down when news of the accounting irregularities first surfaced. German prosecutors launched a fraud investigation into the business at the start of the month.