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Steinhoff Promotes COO To Interim CEO Amid Accounting Scandal

Published on Dec 19 2017 12:30 PM in Retail tagged: Trending Posts / Steinhoff / Accounting Scandal

Steinhoff Promotes COO To Interim CEO Amid Accounting Scandal

Steinhoff International Holdings assembled a crisis team of insiders to try to rescue the global retailer amid a crunch meeting with bankers that may determine the company’s future.

Chief operating officer Danie van der Merwe is the new interim chief executive officer of the owner of Mattress Firm in the US and Poundland in the UK, replacing Markus Jooste, who quit after the company reported accounting irregularities two weeks ago.

Alexandre Nodale, CEO of Steinhoff-owned French furniture chain Conforama, has been appointed deputy CEO, Steinhoff said in a statement.

The duo’s immediate challenge will be to convince lenders to support the company, which suffered a share-price collapse after revealing the accounting issues.

Steinhoff executives were due to meet with bankers in London on Tuesday. Der Merwe and Nodale will be joined by chief financial officer Ben La Grange on a four-member management board alongside Louis du Preez, a corporate lawyer named as new commercial director.

Retail Reshuffle

The appointments mark the latest in a series of reshuffles at Steinhoff, after the company lost 80% of its market value two weeks ago.

On 8 December, it said that three non-executives would form a new subcommittee to oversee governance, including Steve Booysen, who was already head of the audit and risk committee.

Billionaire chairman Christo Wiese joined Jooste in exiting the company on Friday. He was replaced on an acting basis by Heather Sonn.

Whether the management changes will convince South African and global lenders including Citigroup, Bank of America, HSBC and BNP Paribas remains to be seen.

Steinhoff said that it would provide an update on the financial situation after the banker meeting. The company had total liabilities of almost €18 billion as of the end of March.

The shares traded 10% higher, at €0.64, as of 12.44 pm in Frankfurt, where the company moved its primary listing from Johannesburg two years ago amid a breakneck expansion.

Steinhoff is under investigation by South African regulators and is due to defend lawsuits in three countries filed by a former business partner. The company has said that financial results for the last two years need to be restated, and it has earmarked billions of euro in assets for potential disposal.

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