Tekkie Town founder Braam van Huyssteen and former chief executive Bernard Mostert want to stop Steinhoff International from selling the group as the troubled retailer continues to face a liquidity crisis.
Steinhoff International recently sold stakes in KAP Industrial Holdings and Unitrans in an attempt to raise funds. The former Tekkie Town team is seeking to interdict and restrain the respondents, Steinhoff and Pepkor Holdings, from dealing with the shares of the Tekkie Town company or with the Tekkie Town stores and business in any manner that would prevent Pepkor or Steinhoff International from restoring the vendors to their shareholding and control of the Tekkie Town business before these were disposed of to Steinhoff International.
Pepkor, a subsidiary of Steinhoff International, acquired Tekkie Town for R3.3 billion in 2016 after exchanging the entire shareholding in Tekkie Town for restricted shares in Steinhoff.
However, the founders said when Steinhoff collapsed following the revelation of what was initially termed accounting irregularities, Steinhoff’s share price imploded spectacularly and the script which the Tekkie Town vendors had received for their company and its business became commercially worthless.
Steinhoff’s share price declined by more than 90 percent after the 2017 scandal and lost more than R200billion in market capitalisation.
Tekkie Town has more than 200 stores and the founders claim that they handed over a profitable business in exchange for shares.
Van Huyssteen said it was clear to them that following Steinhoff’s publication of the results of the PwC forensic investigation and the company’s own testimony to the Parliamentary committees in March, that their case for restitution was sound.
“By the company’s own admission, what was presented to us as Steinhoff’s financial position in 2015 and 2016 was a far cry from the truth and based on elaborate misrepresentations. Steinhoff’s continuing sell-off of assets to raise cash and stave off liquidation is obviously of concern to us and we need to ensure that the outcome of our main action, which is to restore our shareholding and management control of Tekkie Town, will remain a feasible option for the court to order,” Van Huyssteen said.
The founders of Tekkie Town are also seeking an interdict that would prevent Pepkor and its subsidiary Pepkor Speciality from alienating, transferring, ceding, assigning or otherwise encumbering the shares in Tekkie Town, or the business trading as Tekkie Town.