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It was "animosity" between senior leadership of Steinhoff Africa Retail (STAR) and Tekkie Town founder Braam van Huyssteen that preceded the resignation this week of former Tekkie Town CEO Bernard Mostert, chief operations officer Dawie van Niekerk, and a number of other senior managers.
This is according to Mostert, who reacted strongly to a statement issued by STAR (which will change its name back to Pepkor) on Thursday. Mostert is critical of what he calls "the business culture" at STAR and added that the STAR statement contained some "inaccuracies". One of these, he said, is that Tekkie Town operates 389 stores and not 368 as mentioned in the STAR statement.
According to STAR, the Tekkie Town management walk out arose from a claim over an alleged earn out bonus agreement between Steinhoff International Holdings and the original founders and shareholders. STAR claims it had never entered into such an agreement.
Mostert strongly rejects this as being the reason. He said the resignations came because the "requisite support or guidance" from senior leadership at STAR was not received.
"Our resignation in itself has nothing to do with the earn out, which is a matter that will be determined by the courts. We are confident of a fair decision in this regard,” Mostert said in a statement.
"We cannot work for a company that does not act with the necessary care and diligence with regards to its very important custodianship of public funds,”
By last night 110 employees had resigned, claims Mostert, of which 20 were on the payroll of STAR Speciality and 90 from Tekkie Town.
STAR deployed an interim management and support team to Tekkie Town’s head office in George, led by Ackermans operational director Riaan van Rooyen.
Mostert claims that, over a period of several months, they had tried to engage with the leadership of STAR to facilitate an outcome that would result in Tekkie Town being managed "in a way that it continues to deliver superior gross and operating profit margins".
According to Mostert, Tekkie Town makes a substantial contribution to STAR's profitability. He said the group that resigned view themselves as contributing to the social fabric of George and its people. This, in his view, is not possible under the Pepkor umbrella.
Tekkie Town’s former chief information officer Willem Wait said it was over a period of 11 years that he learnt that Tekkie Town is not the shoes or the branches or the building, but "the individuals that worked, stressed and sacrificed alongside me in order to fulfil a purposeful life and provide for their families".
STAR's chair Jayendra Naidoo told Fin24 on Thursday that STAR has received advice from senior counsel that there is no reasonable prospect of it being held liable for the earn out agreement.
"Our position is that we have a company with lots of expertise and resources and we deployed a management team to take over the running of Tekkie Town. The business is still open and operating. It is important for us, our staff and customers to keep Tekkie Town a success," said Naidoo.
"So, we are looking carefully at our legal rights to make sure STAR and Tekkie Town's positions are not compromised by any other agenda. We find ourselves faced by a number of 'skirmishes', which we are dealing with one at a time. We will manage the situation. We are not in business to go for tit for tat."
As for the overall plan at STAR, Naidoo said once all the corporate issues that came up over the past six months are "tidied up", the "new Pepkor" will continue to focus on retail in Africa and continue to grow as it has been doing.
By early afternoon trade the STAR share price was up 0.83% at R16.95.
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