Markus Jooste resigned with immediate effect amid the retail giant's admission of irregularities in its financial accounts.
Shares in South Africa-based German-listed retail giant Steinhoff fell almost 60% on Wednesday after the company announced the resignation of its CEO in the wake of alleged accounting irregularities.
The firm’s stock lost 58% to trade at €1.26 ($1.48) on the Frankfurt stock exchange around 9.20am, giving it a market capitalisation of €5.7-billion.
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. The board has also approached auditor PWC to investigate allegations of irregular accounting practices.
Steinhoff’s holding company is based in Amsterdam for tax reasons and has its primary listing on the Frankfurt stock exchange.
Steinhoff shares lost over 56% in trading on the Johannesburg stock exchange.
“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.
“Steinhoff will update the market as the aforesaid investigation proceeds.”
The company stressed that it still had profitable businesses in its portfolio and urged investors to “exercise caution” when trading its shares in the wake of the disclosures.
The company’s chairman, Christo Wiese, will become executive chairman on an interim basis.
Steinhoff’s African businesses include a range of credit-based household goods retailers and the company also has extensive interests in Europe.
The firm has a reputation for being highly acquisitive, snapping up retail chains across the world to bolster its own portfolio.
Steinhoff almost merged with Shoprite earlier this year which would have formed Africa’s largest retailer but the plans were scrapped in February.
© Agence France-Presse