JOHANNESBURG- In a latest move to clean up its act, Jayendra Naidoo, Steinhoff International’s sole Black Economic Empowerment partner through Lancaster Group is that latest executive in the multinational retailer to fall on his sword after he tendered his resignation with immediate effect as a member of the supervisory board of the company.
However, Naidoo is not completely out of the picture, as he has been allowed to maintain his chairmanship at Steinhoff Africa Retail Limited (STAR).
In announcement on Thursday morning the company said the decision for Naidoo to resign was aimed at continuing to drive the performance of its key operating assets.
“Jayendra Naidoo has tendered his resignation with immediate effect as a member of the Supervisory Board of the Company, in order to focus his efforts on the board of the Company’s JSE-listed subsidiary company, Steinhoff Africa Retail Limited (STAR), where he is the Chairman. Mr. Naidoo’s position on the Company’s Supervisory Board will be filled by a new independent director to be appointed in due course. The Supervisory Board continues to keep the governance of the Group under review and a number of candidates are in the process of being approached to strengthen the independence of the Supervisory Board,” said the company in SENS announcement.
The giant retailer has lost more than R130 billion in market cap while its subsidiary STAR has lost R22 billion. Other subsidiaries such as PSG, lost R6 billion while KAP has lost its market cap of R21 billion. In total, the company and its listed subsidiaries have lost R184 billion, making it one of the worst crashes in the markets by a company in SA since the dawn of democracy.
Lancaster Group, which is owned by Naidoo appears was exposed by the fall Steinhoff pushing it deep into the financial doldrums. Naidoo, who is also a close friend of Pravin Gordhan, the former finance minister, received R9 billion worth of funding for a 2% stake in the fallen entity.
The loan was provided by Mcebisi Jonas who was deputy minister of finance at the time. The loan has since increased to R10.1 billion. The 2% BEE stake in Steinhoff is
solely owned by Naidoo and has not benefited any other blacks as far as ownership in Steinhoff is concerned.
Commenting on the resignation, Naidoo said: “I am looking forward to focus even more energy on the STAR business. My goal continues to be to work with my fellow board members and our various stakeholders to ensure that STAR continues to develop as an exceptional business, delivering value to the African consumer and all other stakeholders.”
Heather Sonn, acting chairperson of Steinhoff International Holdings N.V said STAR would continue to be a key part of the Steinhoff group.
“It is important to have a focused board and management team in place to maximize the potential of the business,” she said.