Former Steinhoff CEO Markus Jooste enjoyed horse racing. Photo: IOL

When you’re eating baked beans out of a tin can and wondering where the next meal is coming from, you probably don’t shed too many tears about the state of the local horse racing industry.

Yet the two scenarios are inextricably linked by the controversy raging around Steinhoff, the global retailer whose market capitalisation was wiped out almost entirely in the wake of damning allegations of company fraud. Among those affected are thousands of members of the Government Employees Pension Fund, who could lose about R12,5billion in investments, a devastating consequence of what you might generously call exotic bookkeeping.

Most fingers are pointed at Markus Jooste, CEO of the company, who also happens to be the most powerful figure in SA horse racing.

He had a big hand in SA rugby, too, more of which I’ll get to later.

Jooste was a high-flyer, but not in the traditional sense. He was neither flamboyant nor verbose, keeping very much to himself, according to some of his acquaintances I spoke to this week. He owned more thoroughbreds than anyone in South Africa - around 250 raced in his colours - and spent more than anyone at the yearling sales. He also had a seat at SA racing’s boardroom table, so was heavily invested across the sport.

It was more than just business though. Jooste once told an interviewer of how he’d get into his hotel room late at night and unwind by firing up his laptop to watch his horses racing. He had fun with racing, which allowed him to take his mind off business.

Yet he wasn’t a funny guy, rather the stereotypical accountant who kept a stiff upper lip.

Now, those late-night celebratory dinners he so enjoyed after a big day at the races are likely over. Worse, those workers who depended on his largesse, and indeed the many jobs he created, will be enduring a torrid time while investigations and enquiries continue. For a sport that already functions on the margins and must routinely come up with creative ways of making it in a tough market, it is a shattering blow.

It may well be a long time before Jooste even goes to the races. He’ll have horses running at the Met in Cape Town next month, but already labour forces are moving against him. The unions want him banned, and they want the sponsors to act too.

Sport sometimes carries on as if in a bubble, but these are real world problems that cannot possibly be masked by the parade ring or the high-stakes glamour of a major race day. You cannot reasonably oversee a company blowout and then pop up at the races, not even in SA where ethics and morality are so frequently blurred.

By all accounts, the Steinhoff business was a house of cards that spectacularly collapsed. Local entrepreneur Magda Wierzycka described it as close to a corporate-structured Ponzi scheme as one can get.

Thus, it was little surprise to spot Schalk Burger snr’s tweet on Sunday. “Sorry to mention this but Blitzbokke playing in Steinhoff jerseys is disgraceful given the pensioners and older people having lost their savings! SA must get a morality check,” wrote the former Springbok.

To be fair to the Blitzbokke, in a technical sense the jury is still out on Steinhoff - things might smell funny, but no-one has yet been convicted of anything. Only the public court of opinion has ruled.

Yet, you would have to have your head in the sand to imagine that rugby will be unaffected. You can hardly be sponsoring a lark like rugby when pensioners are seeing their savings drained. It gets worse because Steinhoff is also a major backer of varsity rugby.

The Sevens team has enjoyed great success, chiefly because it has been well resourced. This blowout could seriously imperil their ambitions, especially with the sport sponsorship market so tough.

The same is true of varsity rugby, which depends to a large degree on the Steinhoff cheque.

No-one can be sure where local racing is headed, but there will be an enormous void where the sport’s big man once stood. He has since gone to ground, his humiliation complete. Jooste’s reckoning will near, though, as the screams of racing and rugby echo long in his ears.


Sunday Tribune

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