Typically massive receiverships such as this one have flow on effects that no one can really comprehend so early on in the story. It will be months before we know the extent of the losses or what caused them, although remedial work on leaky properties is being cited as one of the chief causes.
The workers may be able to find work elsewhere such as in Christchurch, but the many sub contractors, who must surely be owned money, may stand to lose their shirts. This collapse may be the Reserve bank’s answer to pressure on the exchange rate and rising house prices as it reminds us that the recession isn’t over just yet.
Mainzeal calls in receivers
Duncan Bridgeman and David Williams
Large-scale developer Mainzeal Property and Construction, until recently chaired by former prime minister Dame Jenny Shipley, has been placed in receivership.
The company’s sole remaining director, Richard Yan, made a request to BNZ for receivership, resulting in the appointment of Colin McCloy and David Bridgman of PwC as receivers today.
According to a statement from PwC, Mr Yan advised that a series of events had adversely affected the company’s financial position, coupled with a general decline in commercial construction activity.
In the absence of further shareholder support, the company could no longer continue trading.
The company employed upward of 400 staff.
Mr McCloy says the receivers are committed to “doing the best we can for the suppliers, staff and subcontractors of Mainzeal.”
The company forms part of the Mainzeal Group, which is owned by Richina Inc, a privately held New Zealand-based company with a strong China focus.