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Jan Cronje, Tehillah Niselow30 May 2018 14:57
The accounting irregularities are the subject of a forensic probe by PwC, while the the firm's disgraced former CEO Markus Jooste (above) is being investigated by the Hawks. (Gallo)
Shares in global furniture and retail conglomerate Steinhoff International [JSE:SNH]reached a new low in early trade in Wednesday morning, losing another 5% of the value on the day to trade at just R1.18 a share.
The stock – which had already fallen by 9.9% on Tuesday – reached a new low of R1.18 a share on Wednesday morning before recovering somewhat to trade at R1.24 at 12:53.
Steinhoff shares plummeted in value after financial and accounting irregularities came to light at the company in December 2017.
READ MORE: Steinhoff implosion staggers SA
They are now trading at just 1.3% of their all time high of R96.85 a share in late March 2016.
The accounting irregularities are the subject of a forensic probe by PwC, while the the firm’s disgraced former CEO Markus Jooste is being investigated by the Hawks.
Steinhoff has said it would only be able to release its most recent audited financial results once the PwC probe has been completed.
Despite the volatility in the international retailer’s stock, the JSE has not suspended its shares as Steinhoff continues to trade on the Frankfurt Stock Exchange in Germany, where it has its primary listing.
Steinhoff is technically in breach of the JSE’s listing requirements, having failed to publish its 2016/2017 financial statements in time. However, the Frankfurt bourse has allowed it to continue to trade and the JSE has followed suit.
While Steinhoff risks becoming a penny rand stock, shares in its subsidiary Steinhoff Africa Retail [JSE:SRR] rose slightly on Wednesday following the release of its interim results for the six months ended March 2018.
At 12:42, STAR stock was changing hands at R17.20, up 2% on the day.
STAR, which is listed separately from Steinhoff on the Johannesburg Stock Exchange, incorporates the assets of Steinhoff’s Africa retail operations, including Pep, Ackermans, Tekkie Town and Timbercity.
READ MORE: Steinhoff dances to zombie drums
It announced on Tuesday that it would be changing its name back to Pepkor Holdings in the wake of the Steinhoff scandal. The proposed name change still needs shareholder approval.
Steinhoff remains the largest shareholder in STAR.
STAR CEO Leon Lourens told Fin24 on Tuesday that markets were able to differentiate between what was happening at Steinhoff and corporate governance at STAR.
“We still have these solid companies that have performed very well,” he said. “The majority of them have been part of Pepkor for many years. I think the market sees that.” — Fin 24
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