Star assures investors contingency plans in place

Steinhoff Africa Retail (Star) moved to allay investors’ concerns on Thursday following a number of worrying developments at its Speciality Fashion and Footwear division.

It began with the resignation of the division’s CEO, Bernard Mostert, and other senior executives on Monday.

Star shares fell as news of the developments broke, but on Thursday closed 3.45% higher at R16.81 per share.

In a Sens statement released on Thursday afternoon, Star said contingency plans were in place to ensure operations continued at full capacity.

The group has appointed an interim management and support team from other businesses within Star, led by Riaan van Rooyen, the operational director of Ackermans, to stabilise operations and “ensure continued trading in Tekkie Town stores”.

Star attributed the resignations to a claim relating to a bonus scheme lodged by previous Tekkie Town shareholders that includes Mostert and founder Braam van Huyssteen, which they argue was agreed at the time Steinhoff acquired the business in 2016. Star said it was not party to the bonus scheme.

Van Huyssteen also issued a notice to Star to vacate the premises it rents from him by the end of July.

However, Star said it had legally contested Van Huyssteen’s “notice of demand to remedy a breach” regarding those premises.

Star CEO Leon Lourens said the group “will continue to protect the interest of its shareholders and employees and will vigorously enforce its legal rights in this regard”.

Star said its intervention had been successful in ensuring that trading in Tekkie Town stores had continued.