Former Steinhoff CEO Markus Jooste stunned investors in Johannesburg stocks when his resignation on the back of an investigation into financial irregularities pushed the Steinhoff share into a nose-dive in 2017. The multinational retailer has been teetering on the brink of collapse ever since, with a huge effort in the various markets in which it operates to keep it afloat as investigators unravel a complex web of deals designed to deceive creditors and other stakeholders. The Steinhoff stock was widely held in portfolios. It has emerged that Jooste has been causing waves in the fine-art market too, after he dumped paintings by Jacob Hendrik Pierneef in an apparent effort to source funds. – Jackie Cameron
Steinhoff ex-CEO’s art sale hit price of top South Africa painter
By Loni Prinsloo and John Bowker
(Bloomberg) – A mass sale of art by former Steinhoff International Chief Executive Officer Markus Jooste caused a slump in the price of paintings by famed South African artist Jacob Hendrik Pierneef, according to people familiar with the matter.
Jooste quit as head of Steinhoff the day the global retailer reported accounting irregularities in late 2017, and has since been identified by the retailer as the chief architect of various financial dealings that triggered the company’s near collapse. He’s the subject of an R850m ($58m) claim for damages by Steinhoff, among other lawsuits, though hasn’t been charged and denies wrongdoing.
Sleepy town in the Cape 1929 by Jacobus Hendrik Pierneef.
A locally known art collector, Jooste has been selling various works through private dealers to raise funds, said the people, who asked not to be named as the transactions aren’t public. He owned a number of works by Pierneef, a prolific landscape painter who died in 1957 and remains a staple of auction houses in Johannesburg and Cape Town, they said.
Jooste and his lawyer, Callie Albertyn, didn’t respond to requests for comment.
Confused dealers
A record price of almost R20.5m ($1.4m) for a Pierneef work was paid for ‘Farm Jonkershoek with Twin Peaks Beyond, Stellenbosch’ in June 2017, about six months before the Steinhoff scandal erupted. Art dealers had expected the market to grow from there, but were left confused when some works the following year went unsold, one of the people said. Word quickly spread that Jooste was offloading at least part of his collection.
Johannesburg-based Strauss & Co sold nine Pierneef lots for a combined R9.65m in Cape Town this month, marking a “return to form,” according to an Oct. 15 statement on the auctioneer’s website. “Prices had been diluted by a recent fire sale by a distressed collector,” it said, without being more specific.
Jooste made a number of moves to realise funds in the weeks after Steinhoff’s shares crashed. He put a plot on a luxury estate up for sale and his then-investment firm offloaded a champion race horse.
He has also disposed of his portion of Jonkersdrift Farm in Stellenbosch, near Cape Town, according to three people familiar with the matter. Jooste had co-owned Jonkersdrift with two other former Steinhoff directors, Frikkie Nel and Danie van der Merwe.
Steinhoff was also forced to sell assets to shore up its balance sheet and remain in operation. The owner of Mattress Firm in the US and the UK’s Poundland sold Austrian furniture chain Rudolf Leiner GmbH and stakes in firms such as KAP Industrial Holdings, among other assets.
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