CORPORATE GOVERNANCE
Behind Tongaat’s R2bn share plunge
Since the company announced a ‘review’ of ‘certain practices’, its share price has plummeted 43%. What is the problem?
The market is bracing for further shocks at sugar giant Tongaat Hulett, as its share price has now tumbled to barely a 10th of the R168 in late 2014. The share price has fallen 47% since it was revealed last Friday that it had roped in auditing firm PwC to do a "comprehensive review" of "certain practices which will require further examination". If PwC finds those practices to have been unsavoury, Tongaat said it might "require remedial action including … assessing the impact on previously reported financial information". In other words, Tongaat’s financials may be restated — a devastating indictment of its board and former CEO Peter Staude, who quit last October.
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