Steinhoff will oppose liquidation application

EMBATTLED Steinhoff International said yesterday it would oppose an application by the former owners of Tekkie Town to liquidate the retailer.

The former owners of Tekkie Town launched an urgent application in the Western Cape High Court on Monday.

Steinhoff said it “will oppose the application by the Tekkie Town claimants and will vigorously defend any attempt to disrupt the proposed global settlement and the company’s ongoing Dutch (proposed global settlement) and the proper forum of the Dutch courts”.

The global settlement proposal by the Dutch court incorporates provisions to address the disputed claims of the Tekkie Town claimants against the company which relate to transactions between the Tekkie Town claimants and the company in 2016.

In court papers, the former owners of the footwear retailer said that in 2016 they sold shares to the furniture retailer for R3.2 billion. Then they received shares in Steinhoff that crashed when chief executive Markus Jooste resigned amid allegations of accounting fraud.

Tekkie Town’s former owners launched the application, saying that Steinhoff was unable to pay its debts; its liabilities exceeded its assets by such a margin that Steinhoff has lost more than 75 percent of its share capital.

According to the court papers, the footwear retailer launched various court cases over the years, saying it was “fraudulently induced” to conclude a contract.

The terms of the contract were that they disposed of their interests in Tekkie Town to Steinhoff.

The footwear retailer is seeking R1.86bn back from Steinhoff.

The former Tekkie Town owners said although the company was incorporated in the Netherlands, most of its business was conducted in South Africa, and the country’s liquidators should deal with the liquidation of the company.

The Steinhoff group had faced several claims and litigations against it, and as a result, Steinhoff has proposed a settlement of €943 million (about R16.03bn) to its claimants.

Its former auditing firm, Deloitte, has agreed to contribute €77.94m, and former Steinhoff directors and officers contributed €78.1m to help settle claims against the group, although they said this was not admission of any liability or wrongdoing.