Tycoon disowned by the town he impoverished
As thousands gathered near Cape Town last weekend for South Africa’s oldest horse race, five-time owner-of-the-year Markus Jooste was nowhere to be seen. But he wasn’t forgotten.
The former chief executive of Steinhoff International Holdings is at the centre of the accounting scandal that has wiped some $14 billion off the retailer’s market value and roiled the wealthy enclave of Stellenbosch, where many prominent business leaders live, work and play. Mr Jooste would probably have met a chilly reception at Kenilworth Racecourse this year.
“People are cheesed off,” said Heather Steel, 58, as she waited near the grandstand between races last week. “He’s lost a lot of people money, a lot of pensioners too.”
Mr Jooste led an acquisition spree that turned Steinhoff into a global retailing giant, a national champion and a source of pride in Stellenbosch, home to its plush South African headquarters and one of the country’s elite universities. Surrounded by vineyards and the Helderberg and Simonsberg mountains, the town’s oak-lined streets are fringed with restaurants, boutiques and art galleries. Cape Dutch architecture points to the region’s colonial history, as does the widespread use of the Afrikaans language.
Signs of Steinhoff’s presence, once splashed all over town, are diminishing in the wake of the scandal, in some cases almost overnight. The company’s sponsorship of Stellenbosch University sports teams had once placed its maroon branding – which matches the school’s colours – on everything from the rugby posts at Danie Craven stadium to the scoreboards, tickets and athletes’ uniforms. Both Mr Jooste and former chairman Christo Wiese are alumni of the university.
Much like every shopping mall in South Africa, the one in Stellenbosch houses Steinhoff-owned outlets such as Pep, Ackermans and Tekkie Town. But in this town, a 45-minute drive from Cape Town, the connection runs deeper.
Now residents are only talking about two topics: Steinhoff, and a crippling drought that has left vineyards, golf courses and the odd vegetable garden as the only patches of green in an otherwise parched valley. For others, the company’s woes have caused such misery that it’s a forbidden topic of conversation at the regular weekend barbecue.
Johann Rupert, the chairman of Swiss luxury goods maker Compagnie Financiere Richemont and South Africa’s richest person, was born and grew up in Stellenbosch. He doesn’t live in the town anymore, but is chancellor of the university. Through Twitter, he has expressed his irritation with how the Steinhoff scandal has sullied the town’s reputation, all the more so because none of those involved were “born in Stellenbosch or grew up there”. Mr Rupert isn’t the only one who has expressed such feelings.
“I don’t think what has happened at Steinhoff is a true reflection of what the town actually is,” said Rob Barrie, a 63year old dentist who studied at the university and has lived in the area since 1980. “Just because one company may be up to no good, doesn’t mean the whole town is corrupt and rotten.”