Wirecard, a company that provided digital payment services to all corners of Europe and became one of the biggest companies in Germany, has now lost money worth more than 2 billion dollars.And it may end up completely bankrupt if it fails to provide the financial earnings report for the year 2019.
The company has somehow stopped itself from providing the financially required document, which provides information and evaluation of the company’s progress.The loss in trust incurred by the said report’s delay has proven fatal, with the company trying to give its reasons that the auditors couldn’t account for €1.
9 billion in cash.The company’s CEO Markus Braun has consequentially stepped down from the leadership position, causing more ripples in the European financial market, especially the digital currency market.
The company boasts of a very long history, considering its field started out in the late 80s at best.
Founded in 1999, the German corporation was the promising giant in the industry, providing payment procedural support for market consumers and businesses of all sizes.Their revenues have been steady, with investors believing in their everlasting growth.
It skyrocketed in revenue in 2018 by earning €2 billion ($2.2 billion), which had been an exponential increase from the earnings report figure from 2013, more than four times. Share prices have also escalated in unseen growth rates, as it reached the top 30 share price lists in Germany in 2018, being valued at more than €24 billion ($26.
9 billion).And now? The shares closed at €25. 82 ($28. 88) on Friday, valuing the company at less than €3. 2 billion ($3. 6 billion).
“Without a very concise explanation in short order, we fear Wirecard is headed to zero,” said Jasper Lawler, head of research at London Capital Group.
The devaluation of the company value as well as the dramatic decrease in share prices is the eventual turnout of the series of events which led to the complete distrust of shareholders in the credentials the company was unable to suffice, which had lasted for 18 months regarding accusations of financial and accounting fraud possibly accused on behalf the executives of the company.
Braun, the disgraced former CEO, suggested Wirecard may itself be the victim of fraud.
“It cannot be ruled out that Wirecard has become the aggrieved party in a case of fraud of considerable proportions,” Braun said in a video statement.In a resignation letter he also said:”The confidence of the capital market in the company I have been managing for 18 years has been deeply shaken,” Braun wrote in the letter.
“With my decision, I respect the fact that responsibility for all business transactions lies with the CEO.”
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