CHICAGO — PureCircle, a producer of stevia-based sweeteners, has made several leadership changes after the company near the end of 2019 reported irregularities in financial results and saw the departures of both its chief executive officer and chief financial officer.
Peter Lai Hock Meng will become the new c.e.o., effective March 2. Stephane Ducroux becomes the new deputy c.e.o., effective immediately. Jimmy Lim Kian Thong will become the new c.f.o., effective Feb. 4.
Issues with the company’s financial reports, which came to light on Sept. 20, 2019, led to the suspension of trading of PureCircle’s stock on the London Stock Exchange. The company’s trading status is still suspended.
Mr. Lai was a non-executive director of Chicago-based PureCircle from June 2008 until March 2017. He presently serves as an adviser to the PureCircle Board on China Matters and is chairman of PureCircle’s two subsidiaries in China. After beginning his career in the Monetary Authority of Singapore, he held various senior management positions in banking institutions, including Morgan Grenfell Asia & Partners Securities, SocGen Crosby Securities, Citigroup Private Bank and OCBC Private Bank.
Mr. Ducroux joined PureCircle in 2018 and has worked in sales and marketing, technical and innovation, and scientific and regulatory affairs. He has more than 20 years of management experience in natural specialty ingredients. He previously was chief operating officer Americas and Asia-Pacific for Naturex.
Mr. Lim has more than 27 years of financial and operational management experience and previously was c.e.o. and executive director of Haitong International Securities. He has a bachelor of accountancy degree from the National University of Singapore and a master’s in business administration from Nanyang Business School, Nanyang Technological University of Singapore.
“Both Peter and Stephane have an intimate understanding of the PureCircle business, our valued customer base and the global market opportunity for stevia as a natural sweetener and replacement for sugar,” said John Slosar, chairman and interim c.e.o. of PureCircle, on Jan. 28. “I am confident that, together with Jimmy as our incoming c.f.o. and our operations and R.&D. leaders, we have a strong and experienced executive team with the right skillset to drive future growth and generate significant value from the market-leading I.P. (intellectual property) we have created and own.”
He added a company audit is moving toward completion.
PureCircle on Sept. 20, 2019, announced a potential issue to the classification and valuation of inventory with an aggregate value of up to $30 million, which had been identified during an audit of financial statements. The company said it would be unable to publish full-year audited results within four months of the year’s fiscal end (June 30, 2019). PureCircle’s trading status on the London Stock Exchange was suspended on Oct. 28, 2019.
The company appointed KPMG L.L.P. to investigate the financial reporting irregularities. KPMG said the issues had the cumulative effect of reducing inventory by about $23 million and consequently increasing cost of goods sold by the same amount, spread across financial years 2018 and 2019 with potentially a relatively modest adjustment for 2017.
The work of KPMG and PricewaterhouseCoopers identified other concerns related to how other transactions were constructed and/or reflected in the company’s accounting records. Some of the matters indicated potential impropriety. PureCircle and its advisers at that time began investigating the matters.
Magomet Malsagov voluntarily stood aside as c.e.o. in November. Rakesh Sinha, then the c.f.o., also resigned in November. He previously had advised PureCircle’s board of directors of his intention to return to the United Kingdom.
Other changes came in PureCircle’s board of directors as well as its remuneration committee, audit committee and nomination committee.
PureCircle, founded in 2002, has been granted over 214 stevia-related patents. Extracts from stevia plants are used to create natural, zero-calorie, high-intensity sweeteners.