Crisis-hit Steinhoff’s report reveals ‘conflicts of interest’

Bloomberg

Steinhoff International Holdings NV was for many years run by a board of tight-knit people, many of whom had done business together for decades.
Just how close they were became apparent with the release of Steinhoff’s 2017 annual report, which identified a plethora of related-party transactions that the company now says weren’t properly disclosed according to best corporate governance practice.
Third-party deals are at the heart of an ongoing accounting crisis that’s almost destroyed the global retailer. In March, Steinhoff identified eight individuals it said were allegedly responsible for inflating asset and profit values, contributing to $17 billion of write-downs. Those included ex-Chief Executive Officer Markus Jooste and other former senior employees.
Christo Wiese, former chairman, found instances where transactions between the company and Wiese-owned entities weren’t properly disclosed. The billionaire has an interest in 10 different companies that had dealings with Steinhoff, including Brait SE, Shoprite Holdings Ltd, Upington Investments Holdings BV, Titan Premier Investments (Pty) Ltd, Toerama (Pty) Ltd and Invicta Holdings. Some of the deals also involved the billionaire’s son, Jacob.
“It shouldn’t surprise anyone that I was in a number of related-party transactions with Steinhoff,” Christo Wiese said by phone, citing the sale of his pan-African clothing business Pepkor as one example.