Construction firm hopes to buy Mainzeal
An international construction firm has made a play for embattled building company Mainzeal.
CeresNZ, a subsidiary of an American company specialising in disaster recovery and demolition, wants to acquire an interest in Mainzeal Property and Construction.
Mainzeal was placed in receivership on Wednesday. Work has ground to a halt at its building sites around the country and many subcontractors are thought to be owed millions of dollars.
CeresNZ manager Bernie de Vere said the company would talk to receivers PricewaterhouseCoopers.
"While there is a significant process to go through before a final decision is reached, strategically, CeresNZ sees this as an extremely positive opportunity for growing its business,'' he said.
"These unfortunate circumstances clearly have created a huge uncertainty as to how and when [Mainzeal's current projects] would be completed.
''However, while this is very early days, CeresNZ believes that it would be in everyone's best interest to get these projects back on track as soon as possible."
Any formal offer would depend on the speed of the receivership process, de Vere said, and how quickly information for due diligence was made available.
CeresNZ specialises in seismic strengthening and building construction, disaster recovery and remediation, land development and civil construction and engineering.
Its American parent company, Ceres Environmental Services, has managed more than US$1.7 billion in contracts over the past 10 years and worked on disaster recoveries such as Hurricane Katrina and the Haiti earthquake.
Its construction expertise covers dams, levees, flood-control works, water and wastewater and utility infrastructure.
CDHB PROJECTS AFFECTED
Canterbury health leaders are seeking legal advice on the fate of key building projects after the collapse of Mainzeal.
The Canterbury District Health Board (CDHB) has development projects with Mainzeal, including earthquake-strengthening of a boiler house, quake repairs at Hillmorton Hospital, and the extension and refurbishment of an in-patient unit.
Chief executive David Meates said the board was talking to lawyers about the Mainzeal announcement and how it might impact on contracts it had with the board.
''We hope to have a better understanding of the situation and what will happen to those CDHB projects currently being managed by Mainzeal before the end of the month," he said.
Mainzeal's receivership will not delay the opening of the Air Force Museum's $14.3 million expansion in Wigram this month.
Museum director Therese Angelo said the expansion would open as planned on February 19 after it reached ''practical completion'' last week before Mainzeal's collapse.
''Unlike some, we have our building. There's still some minor finishing work to be done, but we're in a better position than a lot of others.''
She said the Mainzeal workers she dealt with had been ''absolutely fantastic'' during the project, and she also praised the subcontractors, who could now be at risk.
''They've done a brilliant job, a fantastic job, and they may not get paid, so we really are feeling for the subbies at the moment,'' she said.
CONCRETE CONTRACTOR FEARS LOSS OF $264,000
Doug Haselden is a quarter of a million dollars out of pocket and is faced with forking out his own money to pay his staff's wages.
His concrete company, South Island Shotcrete, did a month-long job for construction giant Mainzeal last year, finishing just before Christmas.
Since then he has been chasing the company for the money he is owed.
Mainzeal went into receivership on Wednesday, which saw many of its work sites around the country shut down and hundreds of subcontractors left in limbo over whether they would get paid.
Haselden met Mainzeal bosses at their Riccarton office yesterday to discuss the debt, and the news was "not good".
"The receivers have got the money. They owe me $264,000 and they knew they were in trouble before I signed the contract. I've been talking to my lawyers."
He was resigned to not being paid.
"I've been chasing them and getting every excuse in the book,'' he said.
"Honestly, I don't think we will [get any money]. They're in such bad shape."
South Island Shotcrete worked on the radar station at Cass Peak on the Port Hills used for air traffic control, completing the job on Christmas Eve.
He had another six jobs lined up with Mainzeal, including more relating to Christchurch International Airport, but said $264,000 left a big hole in the company's turnover.
"I don't have much scraping in the bank. I've got 40 guys working with me. I'm going to do my best [to keep them on, even] if I've got to break into my own funds."
He feared for other contractors caught up with Mainzeal, particularly those working with Vero Insurance, where Mainzeal was a joint project manager for its earthquake repairs.
"Anyone who's insured with Vero now should be absolutely packing themselves because who's going to repair any of their work now? We're all worried as hell."
SUBCONTRACTORS CAUGHT BY SURPRISE
Workers from a Christchurch business owed $1.5 million by Mainzeal rushed to retrieve their equipment from demolition sites as news of the construction giant's receivership broke.
Smith Crane & Construction is among the subcontractors left out of pocket by Mainzeal's receivership.
Smith Crane managing director Tim Smith said his company had partnered Mainzeal to work on the demolition of the 17-storey Clarendon Tower and the Queen Elizabeth II Park sports complex.
He was surprised to hear of Mainzeal's receivership, with no inkling of any problems during their time working together.
"They'd been pretty good right through. We'd been working on the jobs for 12 months and they were challenging, but we'd gone extremely well."
He estimated the company was owed $1.5m by Mainzeal for its work in December and January, but said it would be able to survive the likely loss of the money.
"We're a pretty good sustainable company. I'm in my mid-40s now, and I've been doing this since I was 21. It'll knock our profit down, but we'll be fine," he said.
Smith Crane workers had scrambled to retrieve their tools from the demolition sites as the news broke so they could not be locked up by receivers.
"That was our Waitangi Day activity. We made sure to get everything off the site," Smith said.
He hoped the company could take over Mainzeal's contracts from the Canterbury Earthquake Recovery Authority, but he believed smaller businesses owed money could find themselves in strife as a result of the collapse.
"We've got good assets and good equipment, so we'll survive, but the small guys who buy all their own materials, they might not have the resources to deal with it," Smith said.