Insider cyber-heist allegedly cost South African company R180 million
Technical Systems (TS) owner Theuns Kühn says he lost approximately R180 million in pre-tax profit to Christiaan Kurtz and his associates, who used his company’s confidential information and trade secrets to replicate their products.
TS manufactures transport products for animal feed and is one of the most prominent players in the global market. Kurtz allegedly hacked the company’s emails and stole over 1,000 copyright-protected engineering drawings.
According to Rapport, Kühn could hear within the next week whether the National Prosecuting Authority will take action against Kurtz, a former employee at TS.
Kurtz and his associates allegedly used the stolen drawings to replicate TS’s parts, which they started exporting in 2007.
He was quietly competing directly with his former employer, from which he only resigned in 2009.
In late July 2024, following a decade-long legal battle, the High Court ruled in TS’s favour, with Judge Mark Sher describing Kurtz and his partners’ behaviour as “shameless and outrageous”.
Kurtz has already approached the court for leave to appeal.
Kühn said he lost millions due to Kurtz’s actions and the subsequent legal battle. His company estimated legal costs of R40 million and lost profits of R90 million due to the intellectual property theft.
TS estimated that it lost a further R120 million in potential income over 15 years because it had to reduce pricing due to increased competition.
“In total, we estimate a loss of R180 million in pre-tax profit. And, of course, we’ve also endured many years of frustration and fighting,” Rapport quoted Kühn as saying.
Kühn founded the Cape Town-based company in 1993, starting with one product and three employees.
However, it grew rapidly, reaching 15 employees in 1995 and doubling to 30 by 1996. This immense growth continued into the 2000s and beyond. TS said its staff complement is currently around 150 people.
TS took almost a decade to establish its flagship auger product in the market.
“Technical Systems manufactures poultry feeding equipment, more specifically chain and auger conveyors, for the purpose of conveying materials in various applications,” its website states.
“We branded our auger range in 2008 with the FATIQLESS Trade Mark. We are also the largest auger manufacturer, and we see good growth opportunities in the future.”
The company expanded in 2010, launching subsidiaries Technical Systems Inc. in the US and Technical Systems BC in Holland. It has also rented warehouse space in Brazil and China.
It says 95% of its products are exported directly to major original equipment manufacturers (OEMs) in more than 50 countries worldwide. The OEMs carry out installations worldwide.
TS’s success in the market has been recognised on several occasions.
“Technical Systems was privileged to obtain awards for Exporter of the Year on numerous occasions,” it says.
“This being the fact that we export each year more than 90% of production, the growth rate achieved over the years and our direct strong presence in the world’s leading poultry markets.”
Kurtz could not be reached for comment.
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