Shares in global retailer crash almost 70% after CEO resigns

Image credit

Image credit Sunday Times

The company said its Supervisory Board, akin to a board of directors for US -based companies, has hired the accounting firm PWC to conduct an independent investigation of its finances. Steinhoff Africa said CEO Ben la Grange, who's also chief financial officer of Steinhoff International, resigned.

The owner of the France-based Conforama furniture store chain and Pep clothing stores in Africa has appointed auditor PwC to probe the matter, it said in a statement on Tuesday.

Star's share price fell 29% to R17.55 on Wednesday morning following the announcement of Jooste's departure.

It put Christo Wiese, its largest shareholder and chairman, in charge and later sought to give "additional comfort" to investors anxious about its ability to fund its existing operations, saying it had ‍identified measures that would give it around 2 billion euros ($2.4 billion) of additional liquidity.

Kepler Cheuvreux said the pending tax and accounting investigations "could show severe irregularities".

PSG Financial Services advised shareholders on Wednesday that its board of directors received and accepted the resignation of Jooste as a non-executive director of PSG Group and PSG Financial Services, with immediate effect.

Shares were also down by 66 per cent on the German stock exchange.

Steinhoff is a global giant with annual sales of more than €18 billion (and well over €1 billion in Australia). Steinhoff Africa slumped as much as 29% in Johannesburg, while Shoprite plunged as much as 6.3%, the biggest fall in nearly a year. Attempts to contact Jooste were not immediately successful.

"The company will publish the audited 2017 consolidated financial statements when it is in a position to do so".

While the company has been under investigation for suspected accounting irregularities by a state prosecutor in Germany since 2015, it is not clear if these are the accounting irregularities the company was referring to in its statement.

Steinhoff spun off its Africa business earlier this year, but retains a majority stake in the firm.

Kim Kardashian Reigniting Her Feud with Taylor Swift Leads Today's Star Sightings
Yemen war: Former president Ali Abdullah Saleh 'killed'