Wiese must be
● Steinhoff International has revealed that its accounting errors stretch back into 2016, highlighting the extent of wrongdoing at the clothing and furniture retailer that has led to an unprecedented stock slump.
Earnings for this year and last will have to be restated, the retail giant said late on Wednesday, prompting the shares to slide anew. The issues relate to “the validity and recoverability of certain Steinhoff Europe balance-sheet assets”, it said.
Steinhoff is due to meet banks to navigate a way out of its crisis, which has wiped more than R160-billion off the value of the company. At stake are the future of 130 000 employees and international brands including Mattress Firm in the US, Poundland in the UK and France’s Conforama. Markus Jooste has quit as CEO, and Steinhoff appointed auditor PwC to probe accounting irregularities.
The shares declined 4.4% to R9.37 on Thursday and have slumped 80% since the accounting crisis emerged on December 5.
The Public Investment Corporation, the second-largest shareholder with a 10% stake, has questioned the independence of the board and said billionaire chairman Christo Wiese may have a conflict of interest. Wiese, who has seen his wealth more than halve in a little more than a week, is running the company on an interim basis.
Steinhoff is staring down the barrel of more than R143-billion of long-term debt and has been seeking breathing room from its lenders. Wiese has been trying to negotiate a standstill agreement on a margin loan of R24-billion. The company has gained the support of some key lenders for extra time to repay more than R16-billion owed on a revolving credit facility.
Steinhoff said last week that it was considering boosting liquidity by selling assets worth at least R16-billion.