CBK Commerzbank AG

By Paul J. Davies 

Wirecard AG's chairman, who resisted calls for an independent audit of the under-fire German payments group, quit his role effective immediately -- a move the company said was aimed at improving its corporate governance.

Wulf Matthias, chairman of the company since 2008, will be replaced by Thomas Eichelmann, who joined the board in mid-2019 and heads its audit committee.

Wirecard announced the change at 11 p.m. local time on Friday following a board vote. Mr. Matthias will remain on the company's supervisory board until his terms expires in 2021.

Wirecard, one of Europe's biggest and fastest-growing fintech companies, last year broke into the DAX 30 index of Germany's top firms, displacing local lender Commerzbank AG. Its electronic-payments business processes transactions for retailers online and in stores and has a history of focusing on higher risk sectors like travel, gambling and pornography.

"We consider this as a step to improve our corporate governance," a Wirecard spokeswoman said. "Wulf has reached an age of 75. Everybody is thankful for his contribution, but now it is time to organize for a change of generation."

Wirecard has faced a string of questions and allegations from funds who bet against companies' shares through short selling and from the media over its accounting practices, including in its important Asian operations. Wirecard is currently under investigation by the commercial branch of the Singapore police.

The company has consistently denied any improprieties. Some large investors have privately pressured the group to improve its financial reporting and transparency, according to people familiar with the matter. In October, there were calls for it to commission an independent audit of the issues raised by media reports and short sellers.

Mr. Matthias initially dismissed these calls, telling the Financial Times on Oct. 18 that the work of Wirecard's existing auditor, EY, was sufficient. However, the following Monday, Oct. 21, Wirecard said KPMG would conduct a special audit to try to draw a final line under the matters. That special audit is expected to be completed around the end of the first quarter this year.

Wirecard's rapidly appreciating share price -- at its peak last September, the stock had more than quadrupled in value over the previous two years -- along with a string of acquisitions and limited financial disclosure have helped make it a target for short sellers.

Its stock has been on a roller-coaster ride this year. At its close Friday of EUR110.60, the share price was nearly 43% below its peak.

It appeared to have won the support of one of the world's leading technology investors back in April 2019, when Wirecard said a unit of SoftBank Group Inc. was investing $1 billion as part of a strategic partnership. The Wall Street Journal reported in November that SoftBank had put no money behind the complex convertible bond transaction. Rather, the investment was backed by several executives at Softbank's investment arm and Mubadala, a sovereign-wealth fund based in Abu Dhabi.

"The SoftBank-related entities involved are consistent with our understanding and expectations and that was communicated to our shareholders," a Wirecard spokeswoman said at the time.

The new chairman, Mr. Eichelmann, trained as a banker at Deutsche Bank, worked for consulting firm Roland Berger and later became chief financial officer of Deutsche Börse, the German stock exchange. The 54-year-old has held several other board positions in recent years and will remain head of the Wirecard board audit committee.

Wirecard declined to expand on the personal reasons behind Mr. Matthias's decision to quit.

Write to Paul J. Davies at paul.davies@wsj.com

(END) Dow Jones Newswires

January 11, 2020 14:00 ET (19:00 GMT)

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