{"id":239397,"date":"2018-04-20T07:27:02","date_gmt":"2018-04-20T05:27:02","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=239397"},"modified":"2018-04-20T07:27:02","modified_gmt":"2018-04-20T05:27:02","slug":"steinhoff-finally-faces-angry-investors-after-95-stock-plunge","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/business\/239397\/steinhoff-finally-faces-angry-investors-after-95-stock-plunge\/","title":{"rendered":"Steinhoff finally faces angry investors after 95% stock plunge"},"content":{"rendered":"
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When\u00a0Steinhoff International Holdings NV\u00a0held its annual general meeting a year ago, the company had a market value of about 20 billion euros ($25 billion). Now it\u2019s less than 1 billion euros.<\/p>\n

More than four months after the retailer found a hole in its accounts and Markus Jooste\u00a0quit as chief executive officer, shareholders still have little information about the scope of the wrongdoing or the state of the company\u2019s finances.<\/p>\n

They\u2019ll get their first public opportunity to demand answers at Friday\u2019s AGM.<\/p>\n

Whether management will provide any is unclear.<\/p>\n

\u201cThey can\u2019t fob off shareholders and pretend that anything is normal,\u201d\u00a0Mark Hodgson, a Cape Town-based analyst at Avior Capital Markets, said by phone.<\/p>\n

\u201cThey need to convince shareholders that when it comes to the group\u2019s future there is a plan and sufficient urgency and focus on preserving some value.\u201d<\/p>\n

Jooste led an acquisition spree that turned the Stellenbosch, South Africa-based retailer into a global giant. Shareholders bought into the expansion, fueling a tripling in the stock price between late 2012 and early 2016. In December, the company disclosed that it found accounting irregularities and the stock began a dizzying plunge of as much as 95 percent.<\/p>\n

Since then, Steinhoff has been offloading assets to raise cash and negotiating with creditors to keep the company afloat. It\u2019s raised about $1.7 billion selling everything from a company jet and a Vienna department store to shares in a South African household goods retailer.<\/p>\n

So far, it\u2019s held onto its main international subsidiaries, which include Conforama in France, Poundland in the UK and Mattress Firm in the US.<\/p>\n

Steinhoff needs to show it has \u201ca clear turnaround plan, rather than selling dribs and drabs,\u201d said Theo Botha, a shareholder activist. \u201cFor a turnaround, you have to act with speed.\u201d<\/p>\n

Steinhoff has been unwilling to disclose much about the accounting issues while PwC\u00a0carries out a forensic audit that could drag on until the end of the year. The company did reveal in February that the review is focused on certain off-balance-sheet structures and deals with related parties and that additional impairments may be required beyond those already flagged.<\/p>\n

Most of the irregularities appear to\u00a0relate\u00a0to the group\u2019s business\u00a0in central Europe, it said.<\/p>\n

With that statement, Steinhoff \u201clifted its skirts a little bit more,\u201d said\u00a0Charles Allen, a London-based analyst at Bloomberg Intelligence. He expects the company to give some fresh details Friday.<\/p>\n

For a second year, Steinhoff will hold its AGM at a hotel near Schiphol airport after moving its official head office to Amsterdam and its main stock-market listing to Frankfurt from Johannesburg.<\/p>\n

The company is still managed from its South African headquarters in Stellenbosch, a wealthy town surrounded by vineyards about 45 minutes by car from Cape Town. Shareholders will also be able to view a live broadcast of the meeting and ask questions from a conference center in Cape Town.<\/p>\n

The company will give an update on the actions taken since December to stabilize its cash position and strengthen corporate governance, according to the agenda. There will also be a review of Steinhoff\u2019s business and strategy, followed by a Q&A session.<\/p>\n

To pacify shareholders, Steinhoff has\u00a0scrapped\u00a0the AGM\u2019s most controversial proposal\u2014a vote on additional payouts to supervisory board members, including interim Chairman\u00a0Heather Sonn, as a reward for extra work to avert a collapse.<\/p>\n

Steinhoff has nominated five new members to its supervisory board, including Peter Wakkie, who was brought in by Royal Ahold NV as head of corporate governance after the Dutch retailer\u2019s own accounting scandal in 2003.<\/p>\n

It\u2019s also proposing to reappoint Sonn, audit committee head Steve Booysen, and the founder\u2019s daughter, Angela Kruger-Steinhoff, citing a need for continuity and knowledge of the company.<\/p>\n

\u201cArguably, they should have found more people from the outside,\u201d Allen said. \u201cBut it may be more difficult to attract an external appointment, at least before it\u2019s clear whether the company is a going concern.\u201d<\/p>\n

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Read: Steinhoff says payments to Wiese broke company rules<\/a><\/strong><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

When Steinhoff International Holdings NV held its annual general meeting a year ago, the company had a market value of about 20 billion euros ($25 billion). Now it\u2019s less than 1 billion euros.<\/p>\n","protected":false},"author":59,"featured_media":215195,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9872],"tags":[11703],"class_list":["post-239397","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-steinhoff-international"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/239397","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=239397"}],"version-history":[{"count":1,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/239397\/revisions"}],"predecessor-version":[{"id":239409,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/239397\/revisions\/239409"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/215195"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=239397"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=239397"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=239397"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}