Projects - Asset Restructuring
Baseline Constructions Pty Limited
Restructure of tier 3 builder
Summary
- Sydney, Construction
- Administrator
- Financier – AU$3m
- Employees – AU$500k
- Unsecured – AU$15m
Issues
- Successful tier 3 construction company operating for over 20 years with over 100 staff
- Company was unsuccessful in recovering a material insurance claim on a contract resulting from the negligence of excavation and piling contracts that closed a major Sydney arterial road for 4 weeks
- Loss of litigation and AU$4m in litigation costs resulted in difficulties with cash flow and creditor pressures
Solution
- Negotiated with principals to finalise three active and cash flow positive projects
- Assisted director to propose a debt compromise to maximise return to creditors
- Negotiated with secured creditor to compromise and defer claim in favour of unsecured creditors
- Continued to trade on the business during the administration period to complete projects
Outcome
- Recovered bank guarantees within 12 months
- Employees received 100c/$ of entitlements
- Return to continuing subcontractors was 100c/$
- Return to other unsecured creditors was 8c/$
- Company returned to director