Christo Wiese: All I want to know from Steinhoff's Markus Jooste is, ‘Why’?

Almost nine months to the day since Steinhoff began its precipitous fall on December 6 last year, its 57-year-old former CEO Markus Jooste will come out of seclusion to face a grilling at Parliament on Wednesday.  

The man who was once South Africa’s richest, but whose fortune was severely dented by the Steinhoff saga, confirmed he would be watching Jooste on television on Wednesday. 

Asked what he would ask the man who was once like a son to him - but whom he has not seen nor heard from since December 6 - former Steinhoff chairman Christo Wiese says MPs will know exactly what to ask, but his own question would be a simple, "Why?"  

From that day, Jooste disappeared from public view, after sending a WhatsApp message to a select group of confidantes claiming personal responsibility for what happened to the company that billed itself as the challenger brand to the Swedish furniture juggernaut, Ikea.   

Reports have said Jooste is holed up in the Cape seaside village of Hermanus, where he had to ditch plans to build a seaside mansion of unprecedented proportions after Steinhoff’s value plunged.  

"My question is not meant to imply guilt, but I would want to ask: 'Why did you disappear? Why not stay and explain what happened?'

"We are all captives to a lack of knowledge (about what happened) and it will clarify when the PwC report comes out," says Wiese.

SA's Enron

The accounting and audit firm, PwC, has been contracted to get to the bottom of what happened at Steinhoff. It has pulled a multi-disciplinary team of over a hundred people to investigate what has been dubbed South Africa’s Enron – a reference to it being a tectonic corporate scandal.       

Jooste and Wiese's business and personal relationship goes back 36 years to 1982, when the younger businessman was an articled clerk on the audit of Wiese’s private company, according to reports. 

They hit it off, and their business partnership started at PSG, moving on to Steinhoff, where they plotted to take over the global furniture retail world and to globalise their personal fortunes - until it all went horribly wrong.


Wiese is now suing Steinhoff for R59bn through one of his companies. "The case will take a long time, unless creditors and the company can agree on a restructuring plan.

"There are people working together who are contacting us," Wiese told Fin24 on Tuesday. 

Bloomberg reported earlier in 2018 that the company had 12 000 stores, 130 000 people that work there and €20bn turnover before the scandal hit. Steinhoff has 200 subsidiaries and affiliates, and had exposure to lenders and other creditors of almost €18bn at the end of March, according to data compiled by Bloomberg. 

It is registered in the Netherlands with the main stock listing in Frankfurt.

Restructuring options

While Wiese has issued a summons, he has also spoken to current Steinhoff executives to stress it is not his intention to "push the company over", but he is keen to see a restructuring, which could involve debt for equity swaps even though its debt is trading at a huge discount.

"The restructuring options are varied and there are many permutations," said Wiese. His suit is one of several that Steinhoff is staring in the face. Wiese is, in turn, one of the respondents in an R185bn class-action lawsuit filed by investors. 

In August, LHL attorneys filed the whopping damages claim against former directors, bankers and institutional shareholders of Steinhoff in the South Gauteng High Court. 

While South Africans and parliamentarians may believe Jooste’s testimony will be a tell-all, this is unlikely. Wiese says the PwC report, which was commissioned in December last year, is likely to be the final word on exactly what happened at Steinhoff. He notes not even the German tax authorities, who started an investigation into Steinhoff in 2015, have yet taken action against it.

"Doesn’t this raise in your mind that it is not as simple as people make it out to be, if the Germans are still struggling with it four years later? If it were all that simple, why would PwC need 100 people working on it to know exactly what happened?" asks Wiese.

He reckons that if Steinhoff is aiming to sign off its accounts by the end of the year, it can only do so if the PwC report is reflected in the final statements. 

At Steinhoff, insiders expect that Jooste will either try to charm MPs when he appears before Parliament, or that he will lob the blame for what happened with auditors, directors and independent advisors.  

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