Steinhoff International Holdings NV, shares of which have slumped more than 80% since the South African retailer disclosed that it was investigating possible accounting irregularities, said Dec. 11 that it had rescheduled its annual lender meeting and taken steps to strengthen its independent governance.
The furniture, household goods and general merchandise retailer, which includes the U.S. chain Mattress Firm, was due to host its regular annual lender meeting in London on Dec. 11 but postponed the gathering to Dec. 19.
"The purpose of the meeting will be for the group to provide an update on its ongoing operational and financial situation," said Steinhoff, which is incorporated in the Netherlands. An agenda for the Dec. 19 meeting would be circulated in advance, it added.
Steinhoff — which owns store brands such as Poundland, Harveys and Bensons for Beds in the U.K., and Conforama in continental Europe — said the group was "fully focused on safeguarding operational liquidity to continue funding existing operations throughout its various subsidiaries."
Steinhoff's exposure to lenders and creditors is almost €18 billion, prompting speculation around which institutions could suffer losses, Bloomberg News reported Dec. 8.
On Dec. 11, Investec Group, comprising Investec Ltd. and Investec Plc, issued a statement saying its exposure to Steinhoff was "immaterial" and it was "not expecting to suffer any losses on these credit exposures."
Steinhoff, meanwhile, disclosed that Moelis & Co. had been appointed as independent financial adviser and AlixPartners as operational adviser, with both appointments effective immediately.
"Moelis will support and advise on the group's discussions with its lenders, while AlixPartners will assist on liquidity management and operational measures," the Stellenbosch-based company said.
Steinhoff's share price has crumbled since Dec. 6, when it reported it had begun an investigation into alleged accounting irregularities and its CEO had resigned. In midmorning trading Dec. 11, its Frankfurt-listed shares were down another 2% at 54 cents, giving it a market capitalization of €2.33 billion.
More than €10 billion has been wiped from Steinhoff's market value since Dec. 6. Its market cap was €12.93 billion on Dec. 5, when shares closed at €3.00.
In a separate announcement Dec. 11, Steinhoff said its board had formed a subcommittee of independent nonexecutive directors to bolster independent governance. The subcommittee is headed by Johan van Zyl, former CEO of South African financial services company Sanlam Ltd. and a director of Steinhoff since May 30, 2016, and also includes Steve Booysen and Heather Sonn.
At the same time, the company said its audit committee was working with its statutory auditor Deloitte to facilitate the release of its audited financial statements. The company had been due to report earnings Dec. 6 for the 2017 fiscal year ended Sept. 30. However, it said in a Dec. 4 announcement that it expected to publish its audited 2017 consolidated financial statements before Jan. 31, 2018.
Steinhoff also noted that PwC had been appointed as forensic investigators and started an investigation, adding that trading in its businesses worldwide is continuing without interruption. Steinhoff operates more than 12,000 retail outlets in 30 countries and employs 130,000 people.
