FIFI PETERS: After receiving overwhelming support for its R24 billion settlement offer to shareholders, Steinhoff may be back in court tomorrow (September 14, 2021) to spar against Tekkie Town owners – who still want their company back.
Just a bit of context. Tekkie Town was sold to Steinhoff back in 2016 or so in exchange for shares. Those shares essentially became worthless after Steinhoff’s stock price collapsed in 2017, after the accounting fraud that had been going on for years in the company led by a former Steinhoff CEO Markus Jooste was exposed. Everything just went pear-shaped after that.
Tekkie Town co-founder Bernard Mostert now joins the show. Bernard, thanks so much for your time, especially at a difficult time for you. What can you tell us so far about the legal proceedings and how they are going?
BERNARD MOSTERT: Fifi, good evening. As you say, it is a difficult and complex time. There are a lot of moving parts. We do not view the current process that is under way with Steinhoff to be in any way addressing the fraud that you just mentioned. As a matter of fact, what is happening now is simply an effort to distribute the proceeds of their fraud and avoid all forms of legal action. We, as one party that was defrauded, are quite happy to pursue our action and; in order for us to do that we bought a liquidation application against the company. It was ruled that the case could be heard in South Africa and certain intervening parties have been dismissed subsequently. So I guess tomorrow we start in earnest.
FIFI PETERS: Is it still happening tomorrow, Bernard, because, as you say, there are a lot of moving parts. I saw a Sens statement from Steinhoff a little earlier suggesting that they were approaching the court yet again to ensure that that liquidation proceeding doesn’t continue tomorrow.
BERNARD MOSTERT: At this stage we will be in court tomorrow. Steinhoff ostensibly is going back to court, asking for a second bite of the cherry after two days of arguments as they were dismissed last week along with the intervening parties. But that’s very much in keeping with the history of Steinhoff. We sit here almost four years later, and I was being prosecuted. The fraud hasn’t been laid bare and it has been delaying tactic upon delaying tactic.
FIFI PETERS: Just for our listeners who are intrigued as to why you were fighting so hard for the liquidation case to be heard here in South Africa as opposed to in The Netherlands, what is the significance of that victory?
BERNARD MOSTERT: I think it’s important in that it represents the true timeline of events. You don’t find people referring to ‘Steinhoff the Dutch entity’ or ‘the Dutch company’; people refer to a ‘South African corporate scandal’; they refer to Stellenbosch, where Steinhoff’s registered address is, and they refer to a fraud that was created in the first place and perpetrated by mostly a group of South Africans.
So we feel that the centre of ……3:17 interest of Steinhoff. The place of effective management is South Africa, and that’s why we are pursuing our case here.
And there’s also the contractual point. When we entered into our contract with Steinhoff, Steinhoff explicitly agreed that South Africa would be the jurisdiction for any contractual matters regarding our transaction at the time.
FIFI PETERS: Bernard, are you able to reveal how much this case has cost you so far?
BERNARD MOSTERT: Financially or emotionally?
FIFI PETERS: I suppose financially – if we start there.
BERNARD MOSTERT: Okay. I think in terms of our overall legal cost, not only the case we are pursuing in order to have our business returned to us, or our original transaction cancelled, also with all the other cases going on, cases in which we’ve been attacked, I think our legal bill sits on – I’m happy to say that, I don’t say that arrogantly – just north of R65 million.
FIFI PETERS: I asked that intentionally because I remember covering the case between Old Mutual, a legal entity, and its former CEO who took them to court over what he, Peter Moyo, deemed unfair dismissal. A prominent feature that came up in that case was the fact that a company has a big balance sheet. They’ve got a lot of fire power to appeal and appeal, and appeal again. As an individual, how far can one’s money go? I suppose the question that I want to ask you, Bernard, is how far are you willing to take this?
BERNARD MOSTERT: Fifi, I think that we expect enormous resistance. Essentially what we are battling here is, as I said earlier, distribution of the proceeds of fraud. We’ve seen no intent towards addressing that. As a result we expect it to go a long way. One of the things that we are very confident of is that one day we will get to the Constitutional Court and our case will be addressed. So I guess that answers your question. It will still be a long time.
But we are fortunate that we are in a position to defend ourselves, unlike many other people who have been denied that opportunity. And we are digging in, so to speak.
FIFI PETERS: I understand there’s a lot that you can say at this stage because of the legal sensitivities of the courts. But, just out of interest, have you seen or heard from former Steinhoff boss Markus Jooste since 2017?
BERNARD MOSTERT: Yes. As a matter of fact, I’ve spoken extensively to numerous Steinhoff executives, including Markus Jooste. I can tell you the one place where I haven’t seen him is I haven’t seen him in court, and I think by now we all had hoped that he would be (there). So that is true.
FIFI PETERS: What did you talk about, what did he say?
BERNARD MOSTERT: There are two aspects to it. The first is that you can’t give parking places in your head to bitterness and revenge and so forth. He apologised to me, and apologised to Brahm van Huysteen for the damage that he had caused us. That’s in that on the court papers tomorrow. I think that’s not a secret.
And beyond that nothing other than really platitudes and pleasantries. So I want to say again, and – for those of you who will latch on to this and say we are friends with Markus – we have forgiven him, yes, but we also seem to be the only party willing to go to court and have this fraud splayed open. Everybody else is running for cover, and that leaves me with more questions than answers.
FIFI PETERS: That leaves me with three dots at the end of this conversation, Bernard, signalling that this is not yet over. Thanks so much for indulging us with your time, and we do hope to catch up with you again as the case continues to unfold. That was Tekkie Town co-founder cofounder Bernard Mostert.