December 2017

19Dec

How South Africa’s Steinhoff, owner of Freedom Furniture, cratered in two days

It looked like Steinhoff International Holdings had reached escape velocity from South Africa's deepening economic gloom: A furniture retailer emulating Ikea's model and global ambitions, built by men with their own compelling rags-to-riches stories. Then the debt-fuelled rocket stalled and came crashing down. From her office overlooking Cape Town's waterfront, Sygnia Investment Management chief executive Magda Wierzycka watched on her computer screen on December 6 as Steinhoff's shares began a two-day plunge that cut the price by 80 per cent and lopped some €10 billion ($15.3 billion) from its market value. Read...

December 19, 2017
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14Dec

South African State Pension Fund Lost 0.6% on Steinhoff Plunge

The South African state pension fund said it lost the equivalent of 0.6 percent of its entire portfolio because of the collapse in Steinhoff International Holdings NV’s share price and will insist on representation on a board committee investigating irregularities. The Public Investment Corp. and the Government Employees Pension Fund remain “deeply concerned about Steinhoff,” the entities said in a statement emailed Wednesday from Pretoria. “Recent developments point to serious governance challenges.” In addition to board representation, the PIC and the GEPF will insist on...

December 14, 2017
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13Dec

Investigation launched into largest corporate scandal in South Africa’s history

An investigation has been launched by the government into the largest corporate scandal in South Africa's history, it was announced on Tuesday. The investigation will be led by the Department of Trade and Industry (DTI) and its affiliated organization the Companies and Intellectual Property Commission (CIPC), DTI spokesperson Sidwell Medupe said. The DTI and CIPC have noted with great concern allegations of governance failures and financial irregularities at South African retailer Steinhoff, which led to the resignation of its Chief Executive...

December 13, 2017
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12Dec

South Africa. Government pensions survive Steinhoff fraud

The Government Employee Pension Fund (GEPF) yesterday assured its more than 300 000 beneficiaries their money was safe and would still keep flowing following the fraud being investigated at Steinhoff Investment Holdings and the subsequent collapse of its share price. Trading in Steinhoff opened at about R6 yesterday morning from about R55 on December 1 when the scandal broke, and closed at R8.60. “As at March 31, 2017 the GEPF through PIC owned about R28 billion in Steinhoff International Holdings which...

December 12, 2017
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November 2017

20Nov

South Africa. SAA: no pension money for bail-out

The Congress of SA Trade Unions (Cosatu) will go on a national strike if funds from the Public Investment Corporation (PIC) are used to bail out the ailing SAA, parliament heard on Friday. The federation was presenting its submission to the Standing Committee on Appropriations, detailing its concerns about the airline and its 10 000 workers. Last month, the PIC said it was not ruling out the possibility of bailing out the embattled SAA, after it received cash injections from the...

November 20, 2017
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17Nov

South Africa. Thousands of Transnet pensioners pin hopes on Constitutional Court

About 60‚000 Transnet pensioners have pinned their hopes on the Constitutional Court as they seek to proceed with a class action to seek billions from two pension funds. On Thursday‚ the court heard their appeal against a Pretoria High Court order from last year. Transnet pension fund recipients brought a lawsuit against the Transport Pension Fund and the Transnet Second Defined Benefit Fund and Transnet in the High Court last year. The pensioners wanted the High Court to declare that the...

November 17, 2017
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15Nov

South Africa. Government pension fund says it is ‘over-exposed’ to country’s economy

The Government Employees Pension Fund (GEPF) is “over-exposed” to the South African economy and this needs to be addressed, says Abel Sithole, the fund’s principal executive officer. The GEPF has had an exposure of close to R500bn in local bonds issued by government and state-owned entities (SOEs), as at the end of March 2017, Parliament heard on Tuesday. According to a written reply to questions posed by members of the standing committee on finance, the GEPF said as at the end...

November 15, 2017
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01Nov

South Africa’s State Pension Fund Preparing for National Downgrade

South Africa’s main government workers’ pension fund is seeking permission to invest more cash in international assets to protect against the impact of a possible downgrade of the country’s local-currency debt to junk status. The Government Employees Pension Fund is in talks with Finance Minister Malusi Gigaba about easing its investment criteria to include more foreign bonds and equities, Abel Sithole, principal executive officer, told reporters in Johannesburg on Tuesday. The GEPF currently has 1 percent of its 1.7 trillion...

November 1, 2017
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October 2017

24Oct

South Africa. Gigaba asked not to use government pension fund to bail out SAA

The DA-run Western Cape government has voiced its opposition to the use of public sector workers' pension funds to bail out South African Airways. Finance MEC Ivan Meyer said he had written to Finance Minister Malusi Gigaba to register his opposition to such plans. "I cannot support any decision that puts the pensions of public sector workers at risk‚" said Meyer. He said he had previously spoke against the proposal at the budget council of last month. "We cannot allow any...

October 24, 2017
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20Oct

Politics ensnares South Africa’s biggest asset manager

THE rot in South African politics, which has eaten away at state companies, is spreading. This week McKinsey, a consultancy, apologised for the “distress” it had caused the South African people. Political mud had already drowned Bell Pottinger, a British public-relations firm, and forced resignations at KPMG, an auditor. So the shenanigans at the government-owned Public Investment Corporation (PIC), have set off alarm bells. One concern is an apparent attempt to oust Dan Matjila, its boss. A linked worry...

October 20, 2017
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