Tekkie Town wants R4.7m from Steinhoff-owned Pepkor for 'malicious damage' and 'sabotage'
Tekkie Town founder Braam van Huyssteen is seeking R4.7m in damages from Steinhoff-controlled Pepkor and its top executives, accusing the JSE-listed retail group - which now owns the shoe chain - of “maliciously damaging” and “sabotaging” distribution premises he had let to it.
Pepkor has denied the accusations, saying it will defend its legal rights.
Van Huyssteen, together with former Tekkie Town CEO Bernard Mostert, launched Mr Tekkie in August 2018 after an acrimonious split with Pepkor, formerly Steinhoff Africa Retail. The two say the alleged damage and sabotage was meant to “hobble” their various businesses and prevent hem from earning an income from the premises in George, in the Western Cape.
Tekkie Town officially vacated the premises in December 2019. Their court papers were filed in the Cape Town High court on Monday.
Van Huyssteen and Mostert are seeking the damages from Pepkor and its executives, including CEO Leon Lourens, Pepkor Speciality CEO Corne Klem and Tekkie Town CEO Riaan van Rooyen.
“In terms of the lease agreement, all the improvements on that building were to be for the benefit of the lessor, the landlord. They literally stripped the building. They removed all the storage space, they unbolted and stripped out all the shelving. They even went as far as to break out a walk-in fridge in a cafeteria that was set up on the premises,” said Mostert.
“This is, in layman’s terms, as simple as you arriving back and you see the house that belongs to you that was occupied by somebody else has had all its curtain railings removed and all the electrical cabling cut.
"We have had to spend R5m to date to get the building back into a workable state. We have tenanted the buildings with tenants that include, among others, Mr Tekkie.”
Mostert said based on “certain testimonies and evidence we have obtained”, it is “clear” the reason the building was stripped was “predominantly to cause harm to Braam van Huyssteen and entities associated with him”.
He said some of the fittings and other goods in the distribution centre that had been stripped out had been offered to third parties far below value on the “express condition” that these organisations could not sell the goods back to Van Huyssteen or the “premises where they were installed previously”.
Pepkor 'vehemently denies' allegations
However, Pepkor said it “vehemently denies any claims of sabotage or malicious damage" and that the property “was left in a much better condition that it was received in”.
Pepkor, which says it has “photographic evidence to prove it”, added that it would “take the necessary steps to defend its legal rights” and “allow the legal process to run its course”.
“As it often happens with Mr van Huyssteen, Mr Mostert and co, Pepkor is surprised and astonished to have received these court papers more than six months after the premises were vacated in December 2019,” said Pepkor in a statement on Monday.
"Strangely, the complainants refused to attend any property handover meetings or inspection meetings, despite the numerous attempts (of which evidence exists) Pepkor made to set up such meetings.”
Van Huyssteen originally sold the Tekkie Town business to Steinhoff in September 2016, with he and his team receiving about R1.7bn worth of shares in Steinhoff as part of the sale. They had stayed on as part of the management team of Tekkie Town, and Van Huyssteen also let the George distribution centre to the new owner as part of the deal.
However, in December 2017, Steinhoff’s share price collapsed when former Steinhoff CEO Markus Jooste resigned amid allegations of “accounting irregularities” at the group. As a result, Van Huyssteen and his team were left with shares that were virtually worthless.
Van Huyssteen and Mostert have since been involved in a drawn out battle to get the Tekkie Town business returned to them. That separate court case is expected to be heard either later this year or next year.
“We originally had two distribution centres in George, which we had combined to form what we called the Tekkie Town campus. Those two premises were side by side and they ultimately belong to Braam van Huyssteen, the founder of Tekkie Town. It was let to Braam’s entities and part of the transaction ... was that these leases were taken over by Steinhoff when we exchanged the shares in Tekkie Town for 'fools gold' in Steinhoff,” said Mostert.
“Steinhoff, in a move similar to the 'three-card trick', moved the assets around and they put it into Steinhoff Africa Retail. Only after that did the Steinhoff fraud emerge. They now protest Steinhoff Africa Retail is an independent company with an independent listing, but in reality at the time, when they put all those assets into that company, 100% of it belonged to Steinhoff.”
He said when he and Van Huyssteen launched their action to try and get their controlling interest in the Tekkie Town business returned to them, they “started to experience a lot of aggression from within the Steinhoff ranks and of course from within the Steinhoff-controlled Pepkor ranks, and that led to our effective eviction from the businesses".
"The malicious damage to our properties is effectively just an extension of that aggression," said Mostert.
However, Pepkor dismissed Mostert and Van Huyssteen’s action as “another cheap attempt” to “use the media to fight their personal vendetta against Pepkor and its management”.
“This obsession arose from the fact that they agreed to sell their business to Steinhoff and Markus Jooste with whom they, again strangely, remain very close friends to this day,” said Pepkor.
Mostert said he and Van Huyssteen were among the “first people to take action against Steinhoff” and that “we said from the beginning that Markus Jooste was one of the people who misled us".
Pepkor added that during the last month Pepkor “has had two high court rulings in their favour against Mr van Huyssteen, Mr Mostert and co on other cases but they seem to be intent on keeping the courts busy during a time when it can hardly be afforded”.
Last week a high court barred Mr Tekkie from selling certain footwear stocked by Tekkie Town. Mr Tekkie intends appealing to the Constitutional Court in this matter.
Mostert said he and Van Huyssteen were “happy to let the court decide” in this latest matter “because that is why the courts are there and this case is cut and dried”.