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Steinhoff ex-chairman Wiese open to talks over $4 bln claim

The South African retailer said on Friday that an independent report had found it had overstated profits over several years in a $7.4 billion accounting fraud involving a small group of top executives and outsiders.

Christo Wiese. Picture: Supplied.

JOHANNESBURG - Former Steinhoff chairman and top shareholder Christo Wiese is open to negotiations over his $4 billion claim against the company, he said on Monday, days after Steinhoff released a report that showed the scale of a devastating accounting fraud.

The South African retailer said on Friday that an independent report had found it had overstated profits over several years in a $7.4 billion accounting fraud involving a small group of top executives and outsiders.

Steinhoff did not name the individuals but said those implicated were no longer employed by the company.

Steinhoff first disclosed the hole in its accounts in December 2017, hammering its shares and triggering lawsuits from shareholders including Wiese.

As the largest shareholder in Steinhoff, with a stake of about 20%, Wiese was particularly hard hit by the more than 90% crash in the company’s stock price.

He acquired the stake in 2014 when he sold his company Pepkor to Steinhoff in exchange for shares.

“I would expect Steinhoff to give me back my money, and I will give them back their worthless shares,” Wiese told Reuters.

“But everybody knows the company does not have that kind of money, so our approach has been that the only way forward is for all the stakeholders to sit around the table and reconstruct the company,” Wiese added.

Steinhoff declined comment.

Some analysts have questioned Wiese’s possible involvement in the fraud but he dismissed such suggestions as “insane”.

“People that are making these allegations are insane, or I’m insane. What sane person will put 60 billion rand into a company that he knows is riddled with fraud?,” Wiese asked.

Shares in Steinhoff were up more than 5% at R1.94 in mid-morning trade, valuing the company at around R8 billion, a dramatic fall from grace for a stock valued at R224 billion 15 months ago.

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