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'Handful' of buyers lining up for Mainzeal, says receiver

Monday 11th February 2013

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Receivers for collapsed construction firm Mainzeal Property and Construction say they are entertaining approaches from "a handful" of would-be buyers for either the whole firm or individual projects within it.

PwC receiver Colin McCloy told BusinessDesk that around 200 staff have been made redundant to stem operating cash flows as they move as quickly as possible to a rescue package for the firm, which is understood to have failed because its shareholder, Richard Yan of Richina Group, didn't make a $1.8 million payment on an outstanding $20 million credit facility.

Bank of New Zealand withdrew credit facilities early last week, leading to the announcement of the receivership on Waitangi Day, Feb 6, and the resignation of three independent directors, former Prime Minister Jenny Shipley, former Brierley Investments chief executive Paul Collins, and a Tauranga businessman.

With some 440 staff in total, the receivers had kept on only those they believed could help with the receivership process, said McCloy. Redundancies were across the board from head office to work sites.

Ongoing staff numbers were constantly being reviewed.

McCloy would not comment on the identities or levels of interest from possible buyers, but confirmed the receivers were working at speed in pursuit of a swift resumption of work on key projects that Mainzeal was involved with around the country.

The Christchurch arm of an American firm, Ceres Environmental Services, showed its hand as a potential buyer late last week. CeresNZ has been involved in demolition and site preparation in Christchurch, where Mainzeal was to have been a major player in post-earthquake reconstruction.

Other possible buyers include Fletcher Building and Downer EDI, although neither company has expressed a public view on the potential to pick up all or some of the Mainzeal portfolio.

"There's a handful looking at it as we speak," said McCloy.

Asked whether there was a prospect of a quick rescue, McCloy said: "That's why we are talking to a number of interested parties. We're doing all we can to move things as quickly as possible."

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