South African Labor Group Calls on Steinhoff CEO to Quit Over LoanBy
Steinhoff International Holdings NV Acting Chief Executive Officer Danie van der Merwe should resign after it emerged he borrowed 26.4 million rand ($2.1 million) backed by company shares a week before the stock collapsed, according to the Federation of Unions of South Africa.
“The timing of the loan application is highly suspicious and smacks of insider trading,” Fedusa said in a statement Friday. “There is absolutely no way that Steinhoff top executives, including Van der Merwe, could not have full knowledge of what was going on, on the eve of the share collapse.”
Steinhoff said earlier that the Nov. 29 loan taken out by Van der Merwe’s personal investment company from Investec Plc had been repaid. It’s standard practice for lenders to accept personal assets as security for loans and the transactions have no implications for the company, a Steinhoff spokeswoman said.
Steinhoff reported accounting irregularities on Dec. 5, causing the shares to crash more than 80 percent in three days. Van der Merwe was promoted from chief operating officer to acting CEO on Dec. 19. Bloomberg News reported the loan earlier on Friday.