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German authorities are investigating Jooste and some in his executive team for fraudulently inflating the balance sheets of group-owned companies.
According to Manager Magazin, Steinhoff managers inflated the books of its subsidiaries to sell intangible assets and shares in the company.
The shares of the furniture manufacturer dropped more than 8 percent on the JSE in early morning trade as the news trickled in.
The South African retail group has a primary listing on the Frankfurt Stock Exchange.