Steinhoff Africa Shrugs Off Tekkie Town Management Walkout
(Bloomberg) -- Steinhoff Africa Retail Ltd. said sales at shoe retailer Tekkie Town have been unaffected even after the head of the chain quit alongside about 100 managers over a legal dispute.
STAR, as the unit of troubled Steinhoff International Holdings NV is known, maintains that it’s not liable for a claim brought by Tekkie Town founder Braam van Huyssteen related to an earn-out agreement with its parent. Steinhoff bought Tekkie Town in 2016, more than a year before Steinhoff’s shares collapsed amid an accounting scandal.
“It appears the issues are a result of the claims related to Steinhoff’s purchase of Tekkie Town,” STAR Chairman Jayendra Naidoo said by phone Thursday. “It does appear there are a lot of cultural and chemistry tensions that have grown up.”
After Tekkie Town Chief Executive Officer Bernard Mostert and other senior management quit, STAR deployed an interim leadership team from various other businesses, led by Riaan van Rooyen. STAR is also contesting an attempt by Van Huyssteen to evict the company from offices in the coastal city of George, where Tekkie Town is based.
“It is harmful and reckless the manner in which senior people have walked off and we take a dim view of that,” Naidoo said. “We will be taking a close look at all of our legal rights in this matter.”
STAR shares gained 3.5 percent to 16.81 rand as of the close in Johannesburg, snapping three consecutive days of losses. The stock has sunk 32 percent since Steinhoff in December announced an investigation into its accounts.
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