follow a political chameleon, who happens to be your father-in-law, isn’t necessarily a big deal. But the timing of Wiese’s move left a bad taste with the Progs. Wiese severed his ties with the party only ten days before the by-election in Simonstown.
The Cape Town daily Die Burger ran the story on the front page under the heading ‘Slag tref PFP in Simonstad – Wiese uit oor boikot’ (Disaster strikes PFP in Simonstown – Wiese out due to boycott).26 Not even the popular cricketer Eddie Barlow, who took on Wiley in Wiese’s place, could win Simonstown, widely seen as an opposition stronghold.
Wiese got stick in the press and Wiley’s re-election was big news, even in the north where the Rand Daily Mail carried it as a front-page lead story. But Wiese shrugged it off, saying that his departure was not timed to influence the by-election.
For Wiley, his re-election took his career to the next level. Botha appointed him minister of environmental affairs. But in 1987 Wiley died suspiciously of a gunshot wound to the head, reported in the press as suicide. Wiese at the time described Wiley as ‘someone who left behind a proud legacy for his country and his people’.27 Three decades later a book by Chris Steyn and Mark Minnie reveals that the legacy might not be quite as positive. In The Lost Boys of Bird Island Wiley is named, along with former defence minister Magnus Malan, as part of an alleged paedophile ring and of a bloody conspiracy to keep it quiet.
While a member of the Cape Bar, Wiese missed the excitement of business. While in the diamond business, he missed the Bar, which he referred to as ‘the best club in town’. Behind the scenes, plans were being made for him to return to another club, one from his home town and with just as much excitement as the diamond industry, politics or the legal profession.
Early in 1981, Wiese returned to Pep Stores.28 By the middle of the year he was executive deputy chairman. In November the company announced that Renier van Rooyen would call it a day as executive chairman and that Wiese would be taking over from him.
Barely 40 years old and at the helm of the country’s most exciting retailer: now that was something to celebrate. Wiese hosted a birthday party and invited good friends and some of Cape Town’s who’s who. ‘It was a fancy affair, because 40 is an important milestone in the life of a millionaire,’ one of the guests, who chose to remain anonymous, told Beeld.29
Wiese booked out an entire restaurant in Bloubergstrand for the occasion. It was champagne and exotic starters and the best cuisine under the sun, according to the newspaper report. And that was even before dessert. ‘Big was the surprise when every guest finds a big, simple doughnut on his plate. Few felt up to it, especially after they’d just had their fill of mouthwatering dishes.’ But then came the announcement: three of the doughnuts contained a diamond each. And the guests, of course, knew about their host’s involvement in the gemstone business. They chewed their doughnuts carefully. Beeld continued: ‘One guest who saw the doughnut as too daunting a task, pinched it thoroughly, felt nothing and pushed it onto the plate of another guest. She, in turn, broke the doughnut in pieces, revealing a lovely diamond to the value of R500.’
The other diamonds were not found that evening. Beeld dispelled any remaining suspicion: ‘It has been learnt that several of the guests have adjusted their bathroom habits for at least the next two days in light of the circumstances!’
The story travelled. A year later, one of Johannesburg’s well-to-do socialite couples splashed out on a celebration for their fifteenth wedding anniversary. Ruscilla Joubert, the hostess, told the Sunday Times that she’d heard of a party in the Cape where diamonds were in the dessert. Not to be outdone, she decided on a bit of extravagance of her own, persuading the caterers that besides caviar and other delicacies, the consommé needed a touch of bling – 22-carat gold dust to be precise.30
The Sunday Times did some digging on the Cape Town party that had inspired Joubert and discovered it was not so much a case of keeping up with the Joneses as keeping up with the Wieses. ‘It was a party for intimate friends after Christo had sold his diamond mine,’ Caro told the newspaper.
Recall that Wiese’s partner in Octha Diamonds had bought him out the previous year. But was the dessert such a big win for the lucky woman who found the stone? ‘We put a few zirconias into some tiny cakes for fun,’ Caro continued.
The newspaper talked to her husband too. ‘Their total value was R40,’ said Wiese.
6.
Pep Stores, take two
‘There won’t be any material changes. The model, policy and principles of the group will stay the same. Perhaps just a change in style.’ 1
Christo Wiese in an interview, 1981
One of the first things to change was the name.
The Pep Stores in Wiese’s charge had become a different animal. It had ballooned from five clothing shops in the Northern Cape, when he first joined the business, to a group with 500 stores and total sales of more than R200 million a year. And it no longer sold only clothes, but also groceries, because in 1979 Pep Stores took over a chain of eight shops with the name of Shoprite. The group also ran a property portfolio and several factories. Within months Pepkor replaced Pep Stores on the Johannesburg Stock Exchange.
Wiese and his team restructured the company into four divisions: clothing stores, food retail, manufacturing and property. But the new structure would serve no purpose for Wiese and his team if they couldn’t retain control. Together, he and the other Pepkor directors controlled around 29% of the shares in Pepkor. This was not nearly enough to discourage a hostile takeover. And with sanctions choking off foreign investment opportunities, some of South Africa’s largest companies had morphed into conglomerates hungry for businesses to buy. So Wiese took a page out of Pick n Pay boss Raymond Ackerman’s book and set up a pyramid control structure.2
These structures had been prohibited by the JSE after the stock market crash of 1969, but in 1981 Ackerman got the nod to create his control pyramid called Pikwik. By April 1983 Wiese had listed Pepgro, which had a majority stake in Pepkor and in which he and his colleagues, in turn, held the most shares.3
Wiese’s aim was for the group to reach R2 billion in sales by 1990 – an ambitious undertaking, as sales for the year to end February 1982 reached R279 million.
Soon it became clear that Pepkor saw groceries as a big source of future revenue. On food the profit margin was significantly lower than on clothing, which partly explains Wiese’s optimistic sales target: a grocer would have to generate much higher sales than a clothing store to show similar profits.
Wiese was willing to prune in order to grow and he soon closed Hotline, a Cape Town-based grocery delivery business. Hotline, acquired by Pep only a year earlier, had some growth potential in the long term, according to Wiese, but he wanted his management’s energy to be spent on more profitable ventures.4
Shoprite by now had 15 stores, all of them in the Cape, but the group had plans to expand and Pepkor’s managing director, Tom Ball, said he saw potential for another 200 such outlets countrywide.5 Checkers, OK Bazaars and Pick n Pay were the market leaders at this stage and none of them could boast 200 supermarkets.
Within six months of taking over, Wiese announced his plans for a new convenience store format aimed at the growing buying power of the middle-income groups. Pepkor kicked off in the Cape Peninsula with three Hyperette stores – smaller than a supermarket, but larger than a café – which, according to Wiese, could ‘literally go to hundreds of stores’. The Hyperette carried a smaller variety of goods than conventional supermarkets, but this ‘souped-up neighbourhood café’, said Wiese, would be ‘on the housewife’s doorstep’.6
The move carried some risk, because competition was intense. Two other chains had already set their sights on this section of the convenience market and had opened a host of stores: Clicks with nearly 50 shops focused on non-perishable goods; and Score, which took over a batch of outlets with the catchy name Save Cave from OK Bazaars.
Groceries might be the future, but in the here and now Pepkor’s biggest cash cow remained its chain of Pep clothing shops. Again