Stanley-Tallwood liquidator cuts deal over KiwiBuild development
By Victoria Young
Sept. 23 (BusinessDesk) - The liquidator for Stanley Group and Tallwood Holdings has cut a deal with the developer of 23 KiwiBuild homes to get subbies paid out immediately.
The arrangement comes as liquidator Damien Grant’s appointment will be challenged this week by a group of creditors whose leader says they are organised and willing to fight.
A deal over developer Solutions Street’s 23 KiwiBuild homes in Auckland’s Papakura has been done to get subcontractors paid but may leave other trade creditors, such as building suppliers, questioning whether it leaves them disadvantaged as they wait for the liquidation process to progress.
Creditors’ claims in the group of companies in liquidation total more than $12 million, and there is about half a million dollars owing to staff, the first liquidator’s reports say.
Grant confirmed $380,000 had been paid to subcontractors directly by developer Solution Street under a deal which covered outstanding invoices for work done and retentions.
Solution Street’s contract had been with the Stanley Group and related companies, while Housing NZ’s three projects caught up in the liquidation are with Tallwood.
Housing NZ has said it is focused on making any valid outstanding payments to subcontractors, but Grant said he couldn’t provide further updates at this stage.
Meanwhile, a group of creditors led by Team Cabling director Dave Burt are pushing to have Grant removed as liquidator and have accredited practitioners, PwC’s John Fisk and Craig Sanson, replace him.
Grant had been appointed by the company’s shareholders.
Fisk confirmed he would attend Wednesday’s creditors' meeting in Matamata and that he had been approached by a group of creditors concerned about how the business was run prior to the liquidation and wanted Grant replaced.
Burt told BusinessDesk his group of disgruntled creditors had connected with 90 percent of the creditors, but would not say how many proxy votes it had gathered.
“As much as I would like to give you the number of proxy votes we hold I’m not sure it would be wise to play our hand too early. I can say we are very satisfied with the result,” Burt said.
“I can also say there are a number of proxies we don’t hold, because those creditors have guaranteed me they will be there in person. I am also confident that we desire the same result.”
The liquidator can be changed if it gets the majority number of voting creditors, representing a majority of the debt owed.
Burt said he had attended many creditor meetings in the past and “typically there is a group of stunned subbies and suppliers there like possums in the headlights.”
“The difference is, this time we are organised, we are ready and we will take this fight to the end, because it is the right thing to do. It is the right thing to do for every subcontractor and supplier who is affected, along with every good main contractor who has to compete with these guys.”
Burt says the group already had commitments for a legal fund to be held in trust to support any legal action following the liquidation.
Grant said he was aware of Burt’s actions but said he had a received a “significant amount” of support from subcontractors and staff.
“I am focused on securing the best outcome for staff and subcontractors given the limited time constraints.”
Grant’s first liquidators’ reports, issued on Sept. 5, estimated a $16 million shortfall from the collapse of the two companies. Grant is yet to disclose his fees but said he had not yet taken any and would disclose his rates before Wednesday’s meeting.
Kiwibank has also appointed receivers to several of the entities in liquidation, with Jared Booth and Tony Maginness appointed on Sept. 6.