Investors sue Steinhoff

Steinhoff International Holdings edged closer to the brink as its shares plunged to new lows following an inconclusive meeting with bankers and German investors sued the global retailer.

The case against the owner of Mattress Firm in the U.S. and Conforama in France was filed in Frankfurt district court, TILP law firm said in a statement on Wednesday. Investors are seeking to recover funds after the South African company reported accounting irregularities, causing the stock to slump about 90 percent over two weeks.

The shares traded 33 percent lower at 0.31 euros as of 10:07 a.m. in Frankfurt, where the company moved its primary listing from Johannesburg in 2015 as part of a breakneck expansion. More than 40 million shares traded, almost double the three-month daily average.

The class-action-style lawsuit, filed Tuesday, is likely to be the first of many cases filed by investors angry over their losses. The news is a fresh blow for Steinhoff, which attempted to appease lenders with a presentation in London on Tuesday, during which it said creditors were withdrawing support and that the magnitude of the accounting errors were still unknown.

TILP is asking shareholders that bought stock between Dec. 7, 2015, and Dec. 5, 2017, to join the lawsuit, saying investors suffered losses because the company didn’t sufficiently inform capital markets about its issues.

Steinhoff has hired PwC to investigate the accounts and has started to sell non-core assets to boost liquidity. Chief Executive Officer Markus Jooste and billionaire Chairman Christo Wiese have both quit in the aftermath of the scandal.

Read: Steinhoff pushed to the brink of collapse as credit lines are cut

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Investors sue Steinhoff