More pain for Steinhoff as shares decline
JOHANNESBURG – Troubled retailer Steinhoff International’s share price yesterday declined by more than 2 percent after it was revealed that several law firms from Europe and South Africa were holding meetings in the country this week for investors who lost money as a result of the accounting irregularities that emerged in December.
In August it was reported that the law firms are launching a classaction lawsuit of R185 billion on behalf of investors in a bid to get some of the money that was lost when the share price plunged by more than 95 percent and reduced the group’s market capitalisation by more than R200bn.
The application is brought by Johannesburg-based classaction law firm LHL Attorneys‚ Dutch firm Bynkershoek Dispute Resolution and German firm TILP Litigation. It is expected that more than 30 current and former directors of Steinhoff and its subsidiaries have been named as respondents. The list includes former chief executive Markus Jooste‚ who resigned after the scandal; former chief financial officer Ben la Grange; and former chairman Christo Wiese.
The group’s current interim chief executive, Danie van der Merwe, is also mentioned as one of the respondents. Ron Klipin, a senior analyst at Cratos Capital, said Steinhoff could be crippled if the lawsuits were successful. “However, the lawsuits, both local and offshore, could take many years before they are settled. By the time this gets to court, the current corporate entity may no longer exist. There may not be enough funds available once preferred creditors have been paid,” Klipin said. The share price declined 2.51 percent on the JSE yesterday to close at R1.94. The consortium of law firms has applied to the South Gauteng High Court for a classaction suit for investors who are seeking damages.
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Source: iol.co.za