The receiver for Mainzeal Construction says it has had interest in buying the company.
The future of Mainzeal is unclear after the company was put in receivership on Wednesday, jeopardising the jobs of hundreds of employers as well as sub-contractors.
Mainzeal is New Zealand's third largest construction firm, behind Fletcher Construction and Hawkins, and has been involved in projects worth $7.5 billion throughout New Zealand since being founded in the late 1960s.
The company, which employs more than 400 staff, was placed in receivership at the request of sole director Richard Yan. Mainzeal is owned by Mr Yan's Richina Pacific, which has interests in China, including a leather tannery business.
In a brief statement, Mr Yan said he had no choice after Richina Pacific withdrew financial support and a series of adverse events, as well as the downturn in major commercial projects, had hit Mainzeal's finances.
Sub-contractors turned up at sites in Auckland and Wellington on Thursday morning to find that they had been locked out.
Receiver tells of workers' and subbies' shock at announcement
The receiver for Mainzeal Construction says staff and sub-contractors were shocked and disappointed when told the news on Thursday morning.
One of the receivers from Pricewaterhouse Coopers, Colin McCloy, says roughly 40 construction sites of various sizes have been shut down around the country.
He says at this stage he can not say how many sub-contractos are involved.
Mr McCloy says it has had a number of approaches from people interested in buying the company.
He says another option could be to sell off individual contracts or groups of contracts.
Mr McCloy says the receivers are working to allow sub-contractors back on sites to collect their tools as soon as possible, and hoping that work on some sites could resume as early as Friday.
About 90 Mainzeal employees met with receivers in Christchurch this morning to discuss their options.
Mainzeal worker and EMPU branch organiser, Paul Johnston, who was at the meeting, says workers and management were shocked to find out about the receivership through the media on Wednesday but says Thursday's meeting was positive.
He says his priority is to find new jobs for the workers, which he is confident they will do.
He says another priority is to retrieve work tools from building sites, which workers have been shut out of.
Some contractors could go to wall says industry group
Graham Burke, president of the Specialist Trade Contractors' Federation, told Radio New Zealand's Nine to Noon programme on Thursday it is likely Mainzeal employs three or four times the number of sub-contractors as it employs staff.
Mr Burke said, in turn, some of these have a large group of sub-contractors under them.
"Often, the larger contractors have difficulty in either paying at all or certainly slowing their payments down. Bearing in mind a lot of companies have got their overdraft secured against their family homes, I think they're probably in for some significant pain."
Mr Burke believed some contractors will go to the wall.
Ailsa McGavin is the director and owner of Key Skills Recruitment in Lower Hutt. She said the company has 20 sub-contractors who have been doing work for Mainzeal at Victoria University's Kelburn Campus.
"The receivers are saying the site is in lockdown until further notice. It could be the early part of next week before anybody gets on site to claim anything that belongs to them. And any debt that's outstanding, we're a bit in the dark with that - we don't know what's going to happen there."
Ms McGavin said those sub-contractors are in limbo, as they won't be able to pick up any work elsewhere until they can get their tools back. The receivership will leave a huge hole in her company's cashflow, but she said it would survive.
PWC (formerly PricewaterhouseCoopers) has been appointed receiver by Mainzeal's banker, the Bank of New Zealand. Receiver Colin McCloy said Richard Yan had decided that the firm could no longer continue trading due to a decline in commercial activity and lack of shareholder support.
Mainzeal's projects include the new campus at the Manukau Institute of Technology, Wellington Airport's international terminal, The Hub at Victoria University in Wellington, the HVDC Inter-Island Pole 3 and demolishing the Claredon Tower in Christchurch.
It is also involved in the reconstruction of Christchurch through a joint venture with MWH, which also includes Vero, to repair and rebuild quake-damaged properties.
Difficult year, say directors
Former directors of Mainzeal Property and Construction, including former prime minister Dame Jenny Shipley, say the company had been through a difficult year, and had been dealing with leaky buildings, payment disputes in one large contract and problems with a Chinese supplier.
On Tuesday, the directors quit Mainzeal Group, which is the holding company for Mainzeal Property and Construction, which they blame on the shareholder failing to inject promised capital into the business, which then prompted the BNZ to withdraw its funding support.
The directors, who include Paul Collins and Clive Tilby, had stepped down from the board of Mainzeal Property and Construction in December last year at the shareholder's request. They say it was paying its bills and had bank support at that time.
CERA defends choice of Mainzeal
The chief executive of the Canterbury Earthquake Recovery Authority is defending the choice of Mainzeal as a preferred contractor to help with the Christchurch rebuild.
Mainzeal Construction, along with global project management firm MWH, won a contract to carry out repair and rebuild work for insurers Vero and AA Insurance.
Smith Cranes was sub-contracted to Mainzeal for the QEII stadium demolition, and is owed about $1 million.
Recovery Authority's Roger Sutton says there was no indication that Mainzeal had financial problems when it was chosen.