Puma, the German maker of sportswear and casual clothing, accused its Greek associates on Monday of financial irregularities and said it had dismissed the two managers of its subsidiary in Greece.
It blamed the two Glou brothers, who each owned 15% of Puma Hellas SA; a joint venture where the Puma company owned the other 70%. At Puma’s head office in Herzogenaurach in southern Germany, a spokesman said they had withheld or misappropriated millions of euros from the unit. He said this was revealed in an initial report from auditors.
In a separate ad hoc statement Puma said it would rebuild its distribution infrastructure in Greece because of the ‘irregularities’ and the general market situation in the country.
The two chief executives of Puma Hellas SA were immediately dismissed and replaced.
‘”This report led to a situation where we had to act immediately” stated the Puma spokesman. The joint venture had been formed in 2005.
The spokesman did not say exactly how much money had been lost but said a charge of 115 million euros or 161 million dollars would be retroactively placed on the 2009 accounts. There would be a writedown of 15 million euros in the 2010 business year.
A restructuring of Puma Greece which has already begun would cost another 15 million euros.
On the Frankfurt Stock Exchange, Puma stock declined 1.35% to 248 euros but recovered. Luxury brands company PPR of France controls a majority of Puma.
The company said that changing the top management at Puma Hellas had prevented further irregularities. Auditing firm Deloitte has been commissioned to conduct a complete extraordinary examination.
Puma’s supervisory board has ordered lawyers to pursue criminal and civil claims against the executives accused of misappropriation.
In Athens one of the dismissed executives Giorgos Glou, told reporters he knew nothing of the Puma company statement and had no further comment at the moment.
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