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Steinhoff Africa, Brait Charge Investors for Manager Loans

  • Wiese-linked companies say loans-for-shares guaranteed
  • Share price slumps expose businesses to staff’s bad debts
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Here’s a surefire way to infuriate your shareholders.

In 2011, two companies linked to South African billionaire Christo Wiese offered top managers an option to buy shares in the businesses they were running. Plenty of companies do that, but not necessarily with this additional sweetener: The executives in question received bank loans to buy the stock -- loans that were guaranteed by the company in the event they couldn’t be repaid.