It is a document full of allegations, 64 closely written pages, difficult to understand for non-insiders. What’s up Impossible to say. But it is enough to bring a company into the international spotlight that otherwise remains largely under the radar outside of specialist circles.
The Grenke AG from Baden-Baden, a leasing specialist primarily for office equipment and software, is operating with sums of billions, but is rather inconspicuous and has remained largely unnoticed by the public – until now.
In the said report, the US investor group Viceroy Research accuses the company, among other things, of irregularities in its balance sheet. Grenke reacted: The report contained “allegations that Grenke strongly rejects,” said the company, which is listed in the MDax stock market index.
“A central accusation is that of the 1078 million euros in cash and cash equivalents reported in the 2020 half-year financial report, a substantial part does not exist. This is proven to be wrong, ”said Grenke. “849 million euros, or almost 80 percent of the liquid funds, were in the accounts of the Deutsche Bundesbank as of June 30, 2020 – as published in the half-yearly financial report. As of today, the balance at the Bundesbank is 761 million euros, ”it said.
The Bundesbank did not comment on Wednesday. As a matter of principle, the central bank does not comment on individual institutions and / or individual business partners, said a Bundesbank spokeswoman in Frankfurt on request.
Nevertheless, none of this leaves the financial market indifferent, also because the Wirecard scandal is still having an impact. The Grenke share has crashed, on the stock exchange the company has lost a good third or around 900 million euros in value since Monday evening. The Federal Financial Supervisory Authority (Bafin) announced that it would check whether Grenke or others have manipulated the price of the share.
The matter is also tricky because Viceroy probably makes a lot of money himself with the story – as in other cases before. With so-called short sales, the group of investors bet on the crash of the Grenke share and makes no secret of it.
The fact that Grenke is so little known may also have something to do with the fact that the business model is complicated and fragmented. At its core, everything revolves around financing transactions for companies, the self-employed and start-ups. According to the company, founder Wolfgang Grenke, now 69 years old and has meanwhile changed to the supervisory board vice position, started with two employees in his place of birth in Baden-Baden in 1978 and did leasing business with a good 20 specialist dealers.
Today the Grenke Group has almost 1,700 employees worldwide and is one of the few companies that remained from the so-called New Market at the turn of the millennium. “Neuer Markt 2” is the address of the company’s headquarters in Baden-Baden.
Grenke is particularly active in what is known as small ticket leasing, which means that the value of the software and equipment purchased under the individual contracts – computers, telephones, laptops and so on – is generally rather low. Consumers know leasing primarily from their cars. However, it is not uncommon for companies to lease inventory for which otherwise large amounts would have to be deposited at once.
The group now also has its own bank. Grenke offers bank accounts, loans and so-called factoring. A factoring company usually buys other companies’ accounts receivable from customers and then takes care of the processing of the payments itself – for a commission.
Wolfgang Grenke enjoys an impeccable reputation in his home town in Baden and is considered to be well connected in politics and society. The father of three adult sons is President of the Baden-Württemberg Chamber of Commerce and Industry and Vice President of the European organization Eurochambres. The 69-year-old is also committed to promoting and sponsoring culture and sport. He is a chess fan and also head of the supervisory board at KSC GmbH, the outsourced commercial operation of the football club Karlsruher SC.
The Grenke company has announced that it will counter the allegations with a detailed reply. If necessary, you want to defend yourself through legal channels. “Grenke reserves the right to take legal action and will initiate them accordingly,” it said.