Get Ahold of the Problem

In Amsterdam, they're calling it "Enron on the Zaan," referring to the river that flows near the headquarters of Royal Ahold, the world's largest food retailer. And while that might be an exaggeration, Ahold has certainly scandalized the Netherlands' normally placid business life. The company's CEO, Cees van der Hoeven, and its finance chief, Michael Meurs, abruptly resigned last week following the discovery that a food-service subsidiary in the U.S. had overstated its operating earnings by at least $500 million. Ahold's stock immediately plunged by two-thirds, erasing €5 billion in value, although it picked up again slightly at the end of...

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