JSE-listed African retail subsidiary Steinhoff Africa Retail (STAR) announced on Wednesday that it was “unaffected by the events at [JSE-listed retail multinational] Steinhoff”.
Steinhoff has delayed the publication of its 2017 financial results indefinitely as it investigates what it terms “accounting irregularities”. Group CEO Markus Jooste also resigned with immediate effect.
In light of the developments at Steinhoff, STAR CEO Ben la Grange has decided to step down as CEO of STAR. However, the board of STAR requested him to remain as a nonexecutive director, which he has agreed to do.
The board of STAR announced that the current COO of the company, Leon Lourens, has been appointed to the board and as STAR CEO with immediate effect. STAR listed on the JSE main board in September. Its share price was R20.09 before midday on Wednesday – lower by about 18% compared with the Tuesday close of R24.60.
Late on Tuesday, Steinhoff announced that it had approached professional services multinational PwC to carry out an independent investigation of the irregularities.
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.
The Steinhoff supervisory board appointed its chairperson Dr Christo Wiese executive chairperson, or delegated supervisory chairperson, on an interim basis. In addition, former Pepkor Group CEO Pieter Erasmus has agreed to join Wiese in an executive advisory capacity to assist with managing the group’s various retail interests worldwide.
Wiese and the board would supplement the management team and would embark on a detailed review of all aspects of the company’s business with a view to maximise shareholder value.
The announcement concluded: “The supervisory board wishes to reassure shareholders that Steinhoff has a number of high-quality profitable businesses around the world.”
Steinhoff’s share price fell by more than 50% by midday on Wednesday, dropping to about R19 from its Tuesday close of R45.65.