Steinhoff tanks 57% as CEO leaves amid accounting probe


Steinhoff tanks 57% as CEO leaves amid accounting probe

Earlier this year Poundland put United Kingdom discount chain 99p Stores - which it bought for £55m two years ago - into administration.

The Wednesday plunge of shares in the firm, which owns Conforama in France, Poundland in Britain, Poco in Germany and Pep in southern Africa, followed news that chief executive Markus Jooste had resigned.

It would publish the audited 2017 consolidated financial statements when it was in a position to do so and would further determine whether any prior years' financial statements would need to be restated.

Chairperson of Steinhoff Holdings International, Christo Wiese will step in as interim CEO after Jooste's resignation.

Steinhoff has been aggressively expanding in developed markets since moving its primary share listing from Johannesburg to Frankfurt in 2015, snapping up Britain's Poundland, U.S-based Mattress Firm and Australia's Fantastic.

Shareholders and other investors in Steinhoff are advised to exercise caution when dealing in the securities of the Group.

The development had wider repurcussions too, with the chief executive of Steinhoff African Retail (STAR), part of Steinhoff which includes the control of Shoprite, also resigning on Wednesday and its shares falling 21.5 percent to 19.30 rand by 0855 GMT. As well as furniture and homeware, it also sells products including clothing, footwear and consumer goods. Steinhoff derives about 60% of its earnings in Europe and 34% in Africa.

"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 company said in a statement.

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

It is not clear if these are the accounting irregularities Steinhoff is referring to in its latest statement.