Shock as 200 Mainzeal workers go

Mainzeal Property and Construction had about 440 staff in New Zealand. Photo / Natalie Slade

Receivers in talks with companies interested in taking over the failed company or some of its projects.

Mainzeal employees reacted with shock and anger to the news that around 200 staff had been made redundant in an effort to reduce the failed construction firm's operating costs, says the company's receiver.

PwC partner Colin McCloy said receivers were in talks with "a handful" of parties interested in buying the company and its assets, either as a whole or by segment, he said. "The sheer cost of employing a large number of people in roles that weren't really required in receivership meant we had to release those staff."

The cuts would probably make the company more attractive to potential buyers, he added. Mainzeal Property and Construction had about 440 staff in New Zealand.

Council of Trade Unions president Helen Kelly said the 200 job losses, combined with the hundreds of contractors out of pocket after the company's collapse, meant there would be a huge fallout from the Mainzeal receivership.

"We would like to see a better commitment to all of the workers involved. It's a disaster," she said.

Ms Kelly said jobs would be available in Christchurch for workers in the construction sector, but the picture would be less rosy for administration staff.

Mr McCloy would not reveal the names of the interested parties PwC was in talks with but said Mainzeal had "good projects and good people" that would make it attractive to potential buyers. The local arm of US firm Ceres Environmental Services has expressed an interest in Mainzeal and there has been speculation that construction firms Fletcher Building and Downer EDI could also be interested in buying the business.

PwC said that since Friday the receivers had been working with contractors and subcontractors to give them access to sites to ensure they were safe and property could be retrieved in a "controlled manner".

"We're continuing to evaluate individual projects in an effort to restart or transfer work on some sites as soon as possible, subject to contractual arrangements and our statutory obligations as receivers," said Mr McCloy.

Meanwhile, Construction Minister Maurice Williamson will be questioned on his connection to Mainzeal when Parliament resumes today following Labour claims of a conflict of interest.

Mr Williamson is a director of air conditioning company Holyoake Industries, which has worked with Mainzeal on several projects.