Receivers take control of Mainzeal
Market watch top headlines
One of New Zealand's best-known commercial construction firms, Mainzeal, placed its operating business in receivership as a combination of leaky homes suits and a botched supply chain from China combined to take the company down.
In a dramatic Waitangi Day afternoon, Mainzeal Property and Construction (MPC) was placed in the hands of receivers at the accounting firm, PwC.
At the same time, the former prime minister Dame Jenny Shipley, former head of Brierley Investments Paul Collins and Tauranga businessman Clive Tilby resigned from the board of Mainzeal Group, which owns MPC.
The directors had already left MPC last December.
A joint statement said all three resigned from MPC at the request of Richard Yan, the ultimate shareholder in Mainzeal.
Yan is chairman of the Richina group of companies based in Auckland and Shanghai, and spoke at the launch of the government's China trade strategy in Auckland last year.
BusinessDesk understands the receivership is over the failure to make a $1.8 million payment on an outstanding $20 million credit facility, and that this was the last straw in a string of difficulties the company had faced in recent years.
MPC had been emerging from the aftermath of a multi-million leaky building suit involving Hobson Towers, a two-tower, 97-unit block in Hobson St, Auckland.
More recently, it's understood MPC was caught in supply chain difficulties involving the New Zealand arm of King Fa'ade Decoration Engineering, a Shenzhen-based company supplying products to the New Zealand market.
Mainzeal is one of New Zealand's biggest construction companies and a major player in the Christchurch post-quake rebuild.
Insurance group Vero said the receivership would not affect the overall recovery in Christchurch.
Mainzeal's website shows it had been reacting to the lack of demand for commercial construction by moving into construction of affordable housing projects, which has emerged as a key political issue in 2013.