Steinhoff scraps vote on extra pay for directors at AGM

Cape Town - Steinhoff has scrapped a proposal to vote on once-off payments of between €100 000 (R1.46m) and €200 000 (R2.92m) to three of its senior board members at its upcoming Annual General Meeting.

In a shareholder announcement on Thursday morning, the global retailer said that the part of the resolution relating to the proposed additional one-off payments for additional work rendered be deleted.

"The supervisory board members who were to receive these additional payments have requested that such matters are not pursued at the coming AGM. They believe that these matters should be left to a newly constituted supervisory board which will be appointed at the AGM, and specifically its remuneration committee, to resolve at an appropriate time in the future," it said.

The once-off payments "to cover the additional work undertaken during the period since the accounting irregularities were identified in December 2017" were set to be voted on at Steinhoff's upcoming AGM. It is set to take place on April 20 in the Netherlands, where Steinhoff's parent company is registered.

Before the resolution was deleted, Steinhoff shareholders were set to vote on whether supervisory board members Steve Booysen and Heather Sonn would each receive a once-off payment of €200 000, and Johan van Zyl receive €100 000.

These payments were proposed for the "extraordinary time commitments" of the three board members since December 2017, when the group's former CEO Markus Jooste resigned amid an accounting scandal. 

Distraction 

Sonn, the conglomerate's acting chair, said in a media statement that the decision had been made at the request of the directors concerned. She said they did not want the proposal to detract from "other critical matters that had to be considered at the AGM".

“There has been a lot of adverse comment and criticism about these proposals, much of it based on a misunderstanding of what was being proposed and why the supervisory board felt the payments were warranted,” she said.

“Shareholders have raised concerns, and the issue threatens to become a distraction when the main objective is maintaining as stable an environment as possible to deliver a controlled restructuring programme in the interest of all stakeholders.”

Shares in the retail giant sank to R3.02 at close of trade on the JSE on Wednesday. 

This share price decrease comes a day after Steinhoff announced that the true value of a real estate portfolio owned by one of its European subsidiaries may be R16bn (€1.1bn) less than previously calculated. 

This after the Stellenbosch-headquartered conglomerate has said earlier in the week that commercial real estate advisory group CBRE had valued the real estate interests of its subsidiary Hemisphere International Properties at "approximately €1.1bn".

This is about half the company's previous estimate of €2.2bn.

Sonn also defended the group's proposal to retain its long-time auditors Deloitte. 

She said the reappointment of the auditors was for the 2018 financial year, which began in October 2017 and ends in September 2018.

“Steinhoff is not opposed to the rotation of auditors, but believes the continuation of Deloitte Accountants BV as auditors until the end of the current financial year in September 2018 is essential," she said.

“One of the company’s main priorities is the expeditious finalisation of audited consolidated financial statements for the 2017 financial year, and the revised statements for the 2015 and 2016 financial years.

"Deloitte is already involved in these matters, and the appointment of a new auditor midway through a financial year may lead to unacceptable delays in the completion of these statements."

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