Infracon owes staff $5m
Council-owned roading company Infracon is expected to pay nearly $5 million to staff.
The first liquidators' report, released on Friday, estimated that employees' claims will total about $5m for unpaid holiday pay, redundancy and wages.
Infracon was placed into liquidation by its shareholders last Monday.
Those shareholders were Tararua District Council and Hawke's Bay District Council.
John Fisk and John Howard of PricewaterhouseCoopers were appointed as liquidators.
Staff are each entitled to a claim of up to $20,340 for wages, holiday pay and redundancy. Any claim more than that becomes unsecured.
Fisk said it was expected that preferential creditors would be paid. He said the liquidators were yet to do an assessment of how much was preferential and how much was unsecured.
A list of more than 400 potential creditors was included in the report. Most of them were unsecured creditors, Fisk said.
Fisk said it was unclear at this stage whether unsecured creditors would be paid.
"Because we haven't got all the invoices in for the most recent trading that the company has undertaken, we're not absolutely certain about that.
"It depends what they have security over, it will come down to what value those assets are that they have security over."
Liquidators will also be investigating the actions of the directors to ensure all relevant legislation was complied with.
Seven directors resigned from the company in the past 12 months.
Fisk said the liquidators were still working through how much the company owed and they had not received all the invoices.
The report said the company lost more than $6m in the past three years, and this was named as a factor in the company's liquidation.
It also stated the recent loss of a major contract was a factor that resulted in the voluntary liquidation of the company.
Fisk said trade creditors were paid on August 20 but there would be some debts that had been incurred from the beginning of August until the liquidation.