Liquidation could destroy settlement process
If Tekkie Town succeeds in its liquidation of Steinhoff, it will cause catastrophic damage to the settlement processes that aim to save Steinhoff and pay thousands of creditors. Instead, creditors are being held ‘to ransom’ by two men applying for the liquidation.
Business Day reports this was the argument of Steinhoff’s counsel, Advocate Arnold Subel, in the Western Cape High Court, where he was seeking a postponement in the case to have the company wound up and its proceeds shared among creditors.
The application by Bernard Mostert and Braam van Huyssteen is part of a bid to have Tekkie Town returned to them.
But Steinhoff also faces more than 100 legal claims totalling about R130bn from shareholders who say they were duped into buying a worthless stock through misleading information.
Subel told the court the settlement has been years in the making.
‘Where we are now is the product of years of negotiations (and) of very, very, very difficult discussions and negotiations (between) the new management of Steinhoff with creditors to find a position which is in everybody’s best interest.’
He accused the two former owners of Tekkie Town of causing ‘irreparable prejudice’ to the thousands of creditors who have voted in favour of the settlement.
Liquidation would ‘kill this goose and prejudice worldwide stakeholders,’ Subel said.
‘Many, many thousands of people will be out of employment. The interests of the general body will not be served by burying this company.’
This, however, was disputed by Tekkie Town Advocate Willie Duminy, who said not one job would be lost if Steinhoff were to be liquidated, notes the Business Day report.
The liquidation is not seeking to close down Steinhoff subsidiaries such as Pepkor, which owns companies such as Ackermans and Incredible Connection, but to wind up its shareholding in profitable firms, Duminy said.
A liquidation would allow the proceeds of Steinhoff to remain in SA rather than go to creditors abroad and allow for an independent investigation into the fraud at the firm, Mostert argued.
Subel argued that there were other avenues in law that Mostert and Van Huyssteen could use to have Tekkie Town returned to them without asking for the liquidation.
Article disclaimer: While we have made every effort to ensure the accuracy of this article, it is not intended to provide final legal advice as facts and situations will differ from case to case, and therefore specific legal advice should be sought with a lawyer.