This interview was originally aired on RSG Geldsake and has been translated into English in this transcription.
RYK VAN NIEKERK: Steinhoff’s proposal to settle more than 100 legal claims against it could not pass the final hurdle today [September 9] as voting on the proposal was postponed to tomorrow [September 10].
In terms of this exceptionally complex proposal, Steinhoff intends to pay around R25 billion to settle the R130 billion-odd worth of claims against the company. The largest individual claimant is former Steinhoff chair Christo Wiese, whose claim runs to some R58 billion.
Christo is now on the line. Christo, a warm welcome to the programme. The settlement proposal has been accepted by various claimants in both South Africa and the Netherlands. Today saw a decision to postpone the voting process. Did something happen behind the scenes that could possibly thwart the approval of that proposal?
CHRISTO WIESE: No, Ryk. A process such as this is usually extremely complicated. If you think of the amounts involved, the jurisdictions, and the number of people involved – claimants from bankers to contractual claimants to people who bought their shares on the stock exchange – one can understand that it is exceptionally complex and one has to expect that not everything will run smoothly. But one hopes tomorrow will signal the end of one of the steps in bringing an end to the sorry story.
RYK VAN NIEKERK: This settlement proposal has been dragging on for a long time; there was initially much dissatisfaction about it. Many of the claimants considered the money Steinhoff offered far too little. However, it seems now that most of these claimants are prepared to accept the offer. Is that your impression as well?
CHRISTO WIESE: That is certainly my view as well. Ryk, always remember that a settlement has one characteristic: it leaves all parties somewhat dissatisfied; that is the nature of a settlement.
RYK VAN NIEKERK: You are the largest claimant following your exchange of Pepkor for Steinhoff shares in, I think, 2014. That claim was R58 billion. What was your settlement agreement, in particular? How much of that amount can you get back?
CHRISTO WIESE: Well, that is in the public domain. The settlement agreement was that I get R8 billion of that back.
RYK VAN NIEKERK: That R8 billion is a great deal of money, but still effectively a very, very big haircut you need to take to receive it. How do you feel about it?
CHRISTO WIESE: Ryk, if you consider that I worked at Pepkor with my colleagues for 50 years building a world-class business, that [the R50 billion haircut] is what I call ‘stolen’ through fraud.
What is most ironic is that those who stole it also now have nothing from it. The real beneficiaries are the bankers and people who lent money to the Steinhoff group long before the Pepkor transaction was concluded – a deal that now appears to be in the fraudulent statements. That is one of those big ironies.
Pep Stores, a business started by a family where all those who worked there worked as a family, now belongs to people in New York and London who have never even seen a Pep store. That’s one of the fraud’s ironic outcomes.
RYK VAN NIEKERK: Many of them will get considerably more back than they invested. You are not the only one negatively impacted, but also ordinary people, those exposed to Steinhoff via their pension funds.
How did Steinhoff handle this situation?
CHRISTO WIESE: I think Steinhoff’s current management and executive did the best they could in the circumstances.
There is a general consensus that, should the company be liquidated, certain claimants such as myself would do far better. Liquidation processes are replete with kinks which destroy fundamentally strong businesses.
There might have been a potentially better outcome, but at the end of the day I, as well as the other claimants, decided to put the debacle behind us and go on with our lives.
RYK VAN NIEKERK: The former owners of Tekkie Town have adopted another approach – actually a very interesting one. They want to get the business they themselves created back. They are not looking to receive a payout. They have applied for Steinhoff’s liquidation. Steinhoff will be lodging an appeal against a previous high court verdict that that liquidation application could be heard in South Africa. That will probably be in court for a while.
But how is this settlement process affected or obstructed by this settlement proposal?
CHRISTO WIESE: I can truly not venture an opinion on that, Ryk. You will understand that in litigious matters, especially other people’s litigation, it’s not clever to express an opinion.
RYK VAN NIEKERK: Nevertheless, it’s still very entangled – when do you foresee that you and other creditors will be able to draw a line and continue with other rather more productive matters?
CHRISTO WIESE: I think all concerned, including the company, are keen to see this thing brought to a close as quickly as possible, but there are processes that have to be followed and people – whose names you have mentioned – who do not necessarily consider that to be in their best interests. Fortunately, there are courts to decide these matters.
RYK VAN NIEKERK: We are currently seeing a big fight for settlements for former investors, but on the other hand the process of finding people accountable – Steinhoff’s former chief Markus Jooste, and his team – is much, much slower. What is your view of that slow progress?
CHRISTO WIESE: Well Ryk, it’s clearly disappointing that it’s taking so long, because it raises doubt on the part of the man in the street about the workings of our legal processes. People are very quick to criticise the South African prosecution authority for taking so long, but one must keep two things in mind.
The first is that this type of fraud apparently committed and put together over a decade is highly complex.
The second thing is that in 2015 the German prosecution authority had already started investigating the people in Steinhoff. If one were to believe the newspaper reports, it laid a charge against Jooste only last week.
So these things are complex and will simply take time.
I foresee that the criminal court case, when it ultimately gets to court, will also take quite some time.
RYK VAN NIEKERK: Over the four years since the bomb went off, have you had any contact with Markus Jooste?
CHRISTO WIESE: No. The last time I heard from him was the day after he announced his shock resignation. I asked him to help me sort out the mess and he promised to do so, but he never turned up.
RYK VAN NIEKERK: Finally, you were recently very ill with Covid-19. How are you doing now?
CHRISTO WIESE: By the grace of God, pretty good. I’m a little better every day, but it’s a long process. It’s not something that you can shed with your clothes. But I’m very grateful for getting through it and that every day is a little better.
RYK VAN NIEKERK: Christo, thank you very very much for your time tonight. That was former Steinhoff chair, Christo Wiese.