TIMELINE: Markus Jooste and Steinhoff's R200bn fall in market cap | Fin24
 
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TIMELINE: Markus Jooste and Steinhoff's R200bn fall in market cap

Sep 05 2018 07:48
Lameez Omarjee

Former Steinhoff CEO Markus Jooste is expected to make his first public appearance since auditors flagged irregularities in the retailer’s accounts. Parliament confirmed last week that a subpoena was served to Jooste to appear before its committees of finance, public accounts, trade and industry and public administration on Wednesday. Jooste is expected to answer questions to identify "institutional flaws and challenges existing in [SA's] financial regulatory framework", as Parliament put it. Fin24's Lameez Omarjee outlines the events following Jooste's resignation and ultimately his appearance before Parliament.

August 24, 2017: Bloomberg cites a Manager-Magazin report stating that Jooste is among the Steinhoff employees being investigated by German prosecutors in a case dating back to 2015 over alleged accounting fraud.

The same say Steinhoff issues a shareholder notice responding to the allegations. "The company rejects the allegations of dishonesty contained in the statements. In particular substantial facts and allegation are wrong or misleading," the statement reads.

December 4, 2017: Steinhoff announces to shareholders that it will release unaudited results for 2017 on December 6. The firm says the supervisory board has not yet finalised a review of matter related to the criminal and tax investigations in Germany, which have delayed the publication of audited financial results.

December 6, 2017: Jooste abruptly steps down as the CEO of Steinhoff after the Stellenbosch-headquartered retail conglomerate's auditors flag "irregularities" in its books. The firm will delay the publishing of its audited financial results.

The firm’s shares plunge by 60%. In a short, informal message sent to staff, Jooste states that he will "take the consequences of [his] behaviour like a man". Christo Wiese, chair of the group’s board, is appointed interim CEO

December 13, 2017: With its stocks showing no signs of recovery, Steinhoff updates shareholders that accounting irregularities may stretch back as far as 2016. Wiese steps down from the group’s supervisory board. Heather Sonn is appointed as the group’s new chair.

December 19, 2017: Steinhoff names Danie van der Merwe as its acting CEO, following Wiese’s resignation. He is later made permanent.

December 20, 2017: First reports of class-action style investors' lawsuits emerge. German law firm TILP files a lawsuit to recover the value lost to shareholders. At this point Steinhoff lost more than €10bn in market capitalisation.

Early January 2018: A number of global banks start to report losses related to Steinhoff. Meanwhile, the group continues to fight a liquidity crunch.

Early January, 2018: German prosecution authorities tell Fin24 that their probe into Steinhoff – separate from the investigations taking place in South Africa – may take several months to conclude, given the number of documents being scrutinised.

January 31, 2018: Parliament holds its first hearings into Steinhoff. While Wiese and the group’s new chair Heather Sonn attend, Jooste does not. Sonn tells a joint sitting of three committees the company had reported Jooste to the Hawks, on suspicion that he had committed offences under the Prevention and Combating of Corrupt Activities Act.

Christo Wiese gives evidence before a committee of

Christo Wiese gives evidence before a committee of parliament into the Steinhoff matter. (Nellie Brand-Jonker, Netwerk24).

Top National Treasury official Ismail Momoniat says that up to R200bn in shareholder value could have been lost due to the decrease in Steinhoff's share price.

February 11, 2018: Wiese announces he has cut his stake in Steinhoff to just 6.2%.

March 28, 2018: Four Parliamenty committees resolve to follow a process to subpoena Jooste after he declines an invitation to attend the second round of Steinhoff hearings.

In a letter to the committees, Jooste’s legal team explain that he could not attend because he is subject to investigations by the Financial Sector Conduct Authority (formerly the Financial Services Board), as well as the Hawks. His lawyers raise concerns that his appearance before the committees could undermine his right to a fair trial.

Additionally, Jooste’s lawyers state that their client believes he will not be able to provide meaningful assistance to the committees now that he has resigned. 

April 4, 2018: Steinhoff holds its Annual General Meeting, where an update on a an internal forensic probe by PwC is given. The PwC investigation so far confirms that there is an overstatement of income and assets at Steinhoff – which took place over a number of years. Steinhoff will publish the report when it is concluded, excluding parts that may influence prosecutions or civil claims.

April 25, 2018: Bloomberg reports that Jooste’s personal investment company Mayfair Holdings is granted a lifeline from banks to which it owes money. Banks gave Mayfair up until the end of the year to repay loans.

April 26, 2018: Former Steinhoff board chair Wiese announces plans to sue Steinhoff.

June 22, 2018: Bloomberg reports that Jooste had oversight of a number of Steinhoff’s transactions which benefited him.

August 21, 2018: Speaker of the National Assembly Baleka Mbete authorises the Standing Committee on Finance to summons Jooste to appear before it, with the purpose of providing insight on the "institutional flaws and challenges existing in [SA's] financial regulatory framework”.

Mbete emphasises that the hearing is not a criminal investigation to establish criminal liability. It is not a civil inquiry either, to establish civil liability of Steinhoff or its employees.

August 28, 2018: Jooste’s legal team reach an agreement with Parliament to present evidence on September 5, 2018.

August 29, 2018: Former Steinhoff CFO Ben La Grange tells Parliament that there were a number of transactions which seemed to be valid at the time, but were later found to be influenced by the former CEO

August 29, 2018: Hawks head of the commercial crime unit, Major-General Alfred Khana, tells Parliament that Jooste cannot be questioned until Steinhoff files a complete statement under oath indicating what happened at the retailer and who is suspected, to accompany a report audit committee chair Steve Booysen filed with the enforcement agency in January.

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