Receivers see handover of Mainzeal projects in the near future
Feb 20 (BusinessDesk) - Receivers for the collapsed Mainzeal Property and Construction say they hope to see work resume or responsibility returned to clients "in the near future" on the numerous projects that stopped in their tracks three weeks ago, when the receivership was announced.
The second largest construction firm in the country, Mainzeal announced its receivership on Waitangi Day, Feb 6. The collapse came out of the blue for its 440 permanent staff and thousands of sub-contractors on sites across New Zealand, especially as the construction industry gears up for a heady period of activity with the Christchurch rebuild.
Partners from the accounting firm PwC, which is managing the receivership, said they "hope to be in a position to either resume work or, as is more likely in a number of instances, transfer responsibility for other projects back to the client or another contractor in the near future."
"Mainzeal is a large and complex receivership with many different stakeholders and we want to assure all parties that the receivership is being progressed as quickly as possible consistent with the receivers’ statutory obligations,” said receiver Colin McCloy in only the second official update since the receivership began.
“We have nearly completed our initial assessment of Mainzeal’s projects and have had ongoing contact with Mainzeal’s clients and staff since our appointment. We will continue walking them through each step of what a receivership means. We understand it is a trying time for everyone.”
However, there had been an orderly transition of a substantial number of Christchurch staff to MWH Recovery, which has bought Mainzeal out of the MWH Mainzeal joint venture, and limited work has resumed on the Kapiti Coast District Council's new aquatic centre.
Mainzeal was placed in receivership after its primary lender, the Bank of New Zealand, withdrew credit lines, which it is understood triggered the inability to make a scheduled payment of a $1.8 million instalment on a $20 million facility, when it fell due.
Statements at the time blamed the cost of repairing leaky buildings and supply chain difficulties involving a Chinese supplier for the company's failure.
Liquidators have subsequently been appointed for King Façade, a company owned by an entity in the Richina group of companies, one of which also owns Mainzeal and all of which are closely linked to Chinese-born Auckland businessman Richard Yan.
The first report from King Façade's liquidators, BDO, found total liabilities of almost $20 million and that the firm's only customer was Mainzeal, which had also been carrying its losses. King Façade has been bringing in building facades from its Chinese parent to allow Mainzeal to undertake remedial work on residential apartments in Auckland and is understood to be a key cause of the Mainzeal receivership.